3.3 The No Child Left Behind Act in the United States

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Notes

BOX 3.3

The No Child Left Behind Act in the United States

Federal funding accounts for only about 2 percent of total public education funding in the United States. The 2001 No Child Left Behind Act made a substantial proportion of these funds conditional on the states’ measuring learning outcomes and using these indicators to set annual school improvement targets. States were required to test students in reading and mathematics and report the results achieved by specific disadvantaged groups. States also committed to achieving state-defined student learning proficiency levels over a 10-year period. Within this timeframe, schools were given annual achievement targets, and the state would introduce remedial measures and sanctions if a school failed to meet them. For example, states could shut schools down, convert schools into charter schools, or use other improvement strategies if schools continued to miss their annual targets. Each state had to prepare and implement plans that included these elements in order to qualify for federal funding. The overall weight of evidence suggests that the No Child Left Behind policy improved learning outcomes and reduced inequality. Studies have used different approaches to identify its impact. A comprehensive study of the effects of the Act shows that it led to increases in per student district education spending, specifically increases in teachers’ pay, and in the proportion of teachers with graduate qualifications. It also appears to have increased the amount of instructional time spent on mathematics and reading (the two subjects included in the Act’s assessment requirements). There is also evidence that it led to improvements in mathematics achievement, particularly in the early grades, and that these improvements were larger at the bottom of the achievement distribution. However, it does not appear to have had as significant an impact on reading achievement. Overall, the improvements identified in the evidence fell short of the targets that the state plans originally set.

Despite these generally positive findings, the No Child Left Behind Act faced significant resistance, and the 2015 Every Child Succeeds Act changed many elements of the original Act. Although the original Act resulted in increased instructional time spent on mathematics and reading, it diverted time and resources away from other subjects that were not included in testing. moreover, even in the tested subjects, instruction was focused on the tested items rather than on the subject as a whole. The Act was also criticized for giving schools an incentive to inflate their overall achievement scores, and, in extreme cases, the pressure to meet targets encouraged cheating. As a result, the subsequent Every Child Succeeds Act expanded indicators of performance beyond test scores and limited the ability of the federal government to tie state funding to specific requirements, including using test scores to evaluate teachers.

Source: Dee and Jacob 2010; Klein 2015, 2016; Koretz 2017;National Research Council 2011.

transfers a quarter of the total transfer to municipalities. Since 2008, the State of Ceará has allocated 72 percent of these discretionary funds based on municipalities’ performance in the education sector, with the remaining funds being allocated based on their performance on health and the environment. These transfers are a very significant revenue source for municipalities and represent as much as one-third of all revenue for poorer municipalities in Ceará (Loureiro and Cruz 2020).

The amounts transferred are determined by a primary “education quality index” that is designed both to measure performance and to increase equity between students within municipalities. The index consists of indicators on early grade literacy, learning measured at the end of primary school, and the proportion of children transitioning to the next grade. municipalities are allocated transfer resources based on their scores on these indicators as well as on the magnitude of their educational improvements over the preceding year.

This ensures that those municipalities with relatively low levels of learning can still receive sizeable allocations if they make progress in a given year. The index also takes into account the distribution of each indicator and the proportion of students taking the assessments used to calculate its indicators. This prevents the incentives from widening inequalities within municipalities.

A comprehensive census-based learning assessment is used to calculate the index, and the results are disseminated to the public. The state’s monitoring and evaluation systems were overhauled and strengthened as an essential element of the implementation of the performance-based transfer. In addition, the Permanent Basic Education Assessment System was expanded to cover additional grades and assessments in mathematics and Portuguese. It now tests all students in selected grades every year. The state funds the expanded evaluation system to avoid any municipal interference in the assessment process. The institution that administers the performance-based transfer makes publicly available all data, the index calculations, and the final transfer amounts.

Rigorous evaluations have shown that the performance-based reform to the fiscal transfer program has improved learning outcomes in most municipalities in Ceará. Even though the transfer was not a specific-purpose transfer, evidence shows that it led municipalities to increase their spending on basic education and narrowed per capita differences in transfers between municipalities (Franca 2014). The performance-based transfer was introduced when many other reforms were enacted aimed at improving the quality of education (Costa and Carnoy 2015). However, evaluations that aimed to isolate the causal impact of the transfers themselves have found that they have had positive, significant, and relatively large positive effects on student enrollment and learning outcomes (Lautharte, Oliveira, and Loureiro 2021; Petterini and Irffi 2013). moreover, it appears that the transfers also narrowed learning gaps between poor and wealthy municipalities (Brandão 2014). Because these outcomes were based on the use of existing revenue sources, the reforms have also increased the overall efficiency of spending in the state of Ceará and its municipalities (Loureiro and Cruz 2020; Wetzel and viñuela 2020).

The evidence from Brazil highlights the potential of performance-based transfers to improve education outcomes, but the evidence base is still limited. Although some countries, mostly in the developed world, have introduced performance-based fiscal transfers in the education sector, they are still relatively rare, and evaluations of their impact are rarer still. Performance-based transfers for education have been introduced in Colombia and Indonesia, and, although no formal evaluations have been completed, there is some evidence that weaknesses in their design and implementation have limited their impact on education outcomes. Evidence on the use of performance-based transfers in other sectors is also sparse but suggests that they have the potential to improve outcomes, although the size of their impact has been mixed (Gertler, Giovagnoli, and martinez 2014; Glassman and Sakuma 2014; Lewis 2014). Transfers of this kind can also face resistance from politicians, bureaucrats, and stakeholders that may receive less funding than before, because they increase accountability and focus on poor performance and inefficiency (Shah 2010). Although there is relatively limited evidence on performance-based fiscal transfers, the evidence on the use of results-based financing in education more generally suggests that two factors are critical for maximizing the impact of transfers of this kind—careful design and the provision of complementary interventions (see box 3.4).