Demographic changes and education expenditures: A reinterpretation

Several empirical studies have estimated a negative relationship between the share of an area's elderly population and per-pupil education spending. These findings have often been interpreted as evidence that an aging population has hindered the growth in per-pupil expenditures. We offer a reinterpretation of these oft-cited estimates and demonstrate that the population has aged in a way not reflected in these earlier studies’ empirical designs. After fully accounting for actual U.S. population trends, we demonstrate that a rise in the elderly share of the population has resulted in a rise in per-pupil education spending, not a decline.