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Three Essays In Public Economics

Three Essays in Public Economics by Joylynn M. Pruitt This dissertation presents three chapters related to each other in their application to public economics. In the study of how utility-maximizing or goal-seeking units achieve economic outcomes, this dissertation presents results for a diverse range of agents including prosecutors and liberal arts colleges. Co-authored with Dr. Bryan McCannon of West Virginia University, the first chapter examines an interesting feature of prosecutor elections, where the pool of potential challengers to an incumbent comes primarily from subordinates within the office. We develop a signaling model that analyzes whether entry into the political race by a subordinate provides voters with useful information. We demonstrate that a challenger can strategically convey information about the incumbent’s quality by entering the race. Anticipating this, poor incumbents exit. Thus, the model matches empirical observations of rare contested elections and rather modest vacancy rates. Compared to the situation where outsiders challenge the incumbent, the election mechanism is effective. The second chapter addresses the disproportionate risks small liberal arts colleges (LACs) face relative to national universities caused by economic pressures such as demographic changes and shifts in schooling preferences. Because of this, it is important to study how efficient the most at-risk collection of higher education institutions are. While other studies have examined the efficiency of elite LACs, these are the institutions most able to weather recent changes due to their higher endowments. I use Data Envelopment Analysis (DEA) to examine the efficiency of nonelite liberal arts colleges. Using the 6-year graduation rate as the outcome of interest, my results show that the average LAC outside the top 100 ranked LACs according to U.S. News & World Report operates at 74 percent efficiency. These rankings are then evaluated as a function of school factors such as location, religious affiliation, varsity sports activity, and enrollment. Results show that suburban LACs with more majors offered and lower enrollment are more efficient. Inspired by the extensive grants and funding recently spread throughout Pennsylvania via historical levels of public funding, the third chapter examines how well high-ranking public school districts are currently using these resources. I employ Data Envelopment Analysis (DEA) to examine the efficiency of the U.S. News & World Report 100 top-ranked school districts in Pennsylvania. Two learning outcomes of interest are used: the 4-year graduation rate, and the grade 11 Algebra 1 Keystone exam results. The results show the average top-ranked school district operates at about 63.8 percent efficiency when using graduation rate as the outcome interest, and 68.8 percent efficiency when using Algebra 1 exam results as the outcome of interest.