One of the most remarkable yet least remarked upon accomplishments in American public education in the twentieth century is the success of the school consolidation movement. Between 1930 and 1970, nine out of every ten school districts were eliminated through consolidation. Nearly two-thirds of schools that existed in 1930 were gone by 1970. These and related reforms transformed the small, informal, community-controlled schools of the nineteenth century into centralized, professionally run educational bureaucracies. The American public school system as we know it was born during this brief, dynamic period. While school consolidation represents what may be the most profound reform movement in twentieth-century education, almost nothing is known about its consequences for students.
In earlier work on the consolidation movement, Martin West and I found that students educated in systems with larger schools earn significantly lower wages as adults.1 Like many others who have studied the relationship between school attributes and student outcomes, we focused our attention on average outcomes. However, there is good reason to suspect that school consolidation influenced the variation in student outcomes as well. In particular, by dramatically cutting the number of schools and districts, consolidation reduced an important source of between-school and between-district variation in educational quality. At the same time, however, consolidation was motivated by a desire to increase instructional specialization, which could be achieved by substantially increasing the size of schools and districts. Thus within-school and within-district variation in education quality may have risen as schools and districts became larger and instruction more specialized. This paper investigates [End Page 49] the relationship between changes in school and district size and variation in student outcomes, as measured by adult wage inequality.
The paper is organized as follows. The first section provides background information on the consolidation movement and related trends in the organization of public education. The second reviews the related literature about the effect of school and district size on student outcomes and about the contribution of education to wage inequality. The third describes the estimation strategy and data. The fourth section presents the results of the analysis, and a final section concludes.
Background: The School Consolidation Movement
The movement for school consolidation must be seen as part of a larger trend toward the professionalization of education that began in the late nineteenth century.2 To the "administrative progressives" of the time, the concentration of authority over schooling in the hands of professional educators was seen as a cure for both the corruption of city school systems and the parochialism of rural systems. Consolidation came first to urban areas, where one of the cornerstones of the progressive attack on rule by political machines was the formal organization of schooling under the leadership of professional superintendents. Reformers then turned their attention to rural areas, where they decried the inefficient, unprofessional, and "backward" practices of small community schools. In their vision of a professionally run school, reformers drew their inspiration from the modern corporation, with its principles of "scientific" management by experts.
At the center of this reform movement was a push for larger schools. The leading education reformer of the early twentieth century, Ellwood P. Cubberley, pressed three primary arguments in favor of school consolidation.3 First, in small schools, many of which had only one teacher, the ratio of administrators and school officials to teachers was unnecessarily high. Larger schools allowed for more efficient, centralized administration. Second, at a time when many small schools did not even divide children by grade level, consolidation held the promise of highly specialized instruction. Teachers in large schools could specialize not only by grade but also by subject area. In addition, reformers sought to provide specialized training to students destined for different roles in the labor force. Third, a consolidated school could provide better facilities at lower cost. For instance, Cubberley's plan for a model elementary school building included—in addition to classrooms—a manual training room, [End Page 50...