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From Boom to Bust: The Effects of the Great Recession on Neighborhoods and Schools

  • Author(s): Mordechay, Kfir
  • Advisor(s): Orfield, Gary
  • et al.
Abstract

The cyclical recurrence of economic crises suggests that they are an inevitable and recurrent phenomenon in American society. The most recent economic downturn that struck in late 2007 and lasted through 2009, referred to as “The Great Recession”, is now generally acknowledged to be the most severe economic crisis since the Great Depression in the 1930s. A lot has been written about the dramatic and nearly simultaneous shocks to the labor, stock, and housing markets that undoubtedly affected millions of American households. While this work has been crucial for expanding our understanding of the consequences of economic shocks, we know little of how the economic shock of The Great Recession impacted children in schools. Understanding the ways in which schools and communities were impacted is crucial to the development of policy responses seeking to stabilize vulnerable neighborhoods and remediating the individual and community-level effects in the event of future economic crises.

Using data from a large urban high school district as a case study, this dissertation analysis considers the effect of the most substantial economic shock in decades on a variety of educational and community outcomes. The study seeks to expand on earlier work by applying a quasi-experimental research design to examine the impact of an exogenous economic downturn on a school district located in San Bernardino County California, an area widely considered at the epicenter of The Great Recession. The findings of this study promise to facilitate our understanding of how recessions impact educational outcomes and the role policy can play to mitigate the consequences.

Data analyzed for the study comes from three sources: (1) Administrative Chaffey Joint Union High School District Records; (2) American Community Survey (ACS) 5-Percent Public Use Micro data; (3) Zillow monthly real-estate data. Maps constructed using Geographic Information Systems (GIS) technology helped depict pre-recession and post-recession changes across San Bernardino County. Both Multi-level and signal level logistic models were developed to estimate the effects of The Great Recession on student subgroups between the periods 2004-2013, controlling for a variety of background variables. Community level findings indicate sharp increases in child poverty, unemployment, and foreclosures caused by The Great Recession. At the student level, results indicate statistically large increases in mobility, particularly for middle class blacks. Perhaps counter-intuitively, steep declines in graduation rates in 2008 are followed by a sharp increase beginning in 2009- largely driven by increases from the most disadvantaged groups. The results suggest that the recession created a counter-cyclical demand for education, but also raises important questions about the effects of district responses to the needs of the most vulnerable students at the height of economic downturns.

Given the results from this dissertation, educators and policy makers may be well served by considering economic cycles when determining the allocation of classroom resources, classroom planning, and cohort dynamics. This is particularly important in the beginning of economic crises, which might adversely impact the most vulnerable students through a variety of pathways. Large scale economic shocks are going to continue to be common feature of the global economic landscape, and these shocks could result in poverty traps, generating effects that harm not just present, but also succeeding generations. In an era of frequent and rapid economic change, it is crucial to understand the associations between large-scale economic change and educational opportunity.

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