Does Money Matter? Both Sides in Debate Have a Point

By Debra Viadero

When the Brookings Institution this month unveiled a book calling for schools to adopt more disciplined spending practices, it waded into an academic and political morass that has been growing in recent months.

The central question at issue is this: Does spending more money on schools improve students' academic achievement? The Brookings report, called Making Schools Work: Improving Performance and Controlling Costs, concludes that more money makes no difference--that is, at least, if it is spent in the ways schools have typically used it. (See Education Week, Oct. 12, 1994.)

The panel of economists that put together the report based its concluions in part on studies done in the 1980's by Eric A. Hanushek, the lead author...