A Model of Optimal Plant Size With an Application to the Demand for Cognitive Achievement and for School Size

Abstract

A model oj optimal plant size is developed which predicts that 1) plants experience increasing returns to in-plants inputs, 2) the relative price of plant output is greater in rural areas than in urban areas, and 3) plants are larger in urban areas than in rural areas. The model's predictions appear to be consistent with behavior in a number of consumer services (e.g., grocery, movie, and library services). These predictions are more rigorously tested and are strongly supported when demand functions for cognitive achievement and for school size are estimated.These regressions also lend support to the quality-quantity model of fertility.

Does restricting choice in referenda enable governments to spend more?

“…Accordingly, an increase in the percentage of the population that is of school age (School Age) is expected to result in lower spending per pupil. 7 In more densely populated areas, schools are able to take advantage of economies of scale in schooling, which lowers costs (Kenny 1982). On the other hand, teacher salaries are higher in metro areas because the cost of living is greater (Kenny and Denslow 1980).…”

Institutions, quality competition and public service provision: The case of public education

“…The consequences of intergovernmental competition will be most apparent within a metropolitan area because they approximate local labor market areas thus representing a practical range of residential mobility. Evidence by Kenny (1982) suggests that population density increases public school effectiveness in part because of lowered transportation costs. Also, information flows regarding school quality are likely to be greater in metropolitan districts than in rural districts in part because of more efficient information flows.…”

The Legacy of Serrano: The Impact of Mandated Equal Spending on Private School Enrollment

“…In denser areas, the transportation cost associated with adding one more student is lower. As Kenny (1982) showed, this implies that education is relatively less expensive in urban areas and may explain why children in urban areas learn more, go to larger schools, and spend more days but fewer hours per day in school. Since few children attend private school, in many locations it is difficult for private schools to achieve any reasonable economies of scale.…”

“…An increase in the number of school districts allows for more complete sorting and, as Eberts and Book. 1993County and City Extra, 1990census: school districts: 1972,1982fraction Catholic: 1990, Bradley et al ([992);1980, Quinn et al (19821970, Johnson et al (1974; state educ spending: State Government Finances. 1970Finances.…”