Economies of scale for a state system of public school districts

A review of the different variables, school district samples, regression techniques and a priori assumptions utilized in recent studies clearly indicates that no standard model or set of procedures have been developed for the problems of economies of scale within the educational sector. Based on these studies and a brief discussion of the limitations of economies of scale models as a tool in policy planning, we present a generalizable model that can easily be applied to statistics now available in state departments of education to derive valuable new information about the existing cost-size relationships and opportunity costs that exist in a state system of public school districts. A recent application of the model in Oregon that illustrates its generalizability is described. An example of how economies of scale information might be used in policy planning and proposed district consolidations is also outlined.