Both low-income and racial-minority children, on average, score lower than higher-income children or white children on states’ elementary school accountability tests. These test-score gaps point to unequal educational opportunity. In a new report from the New England Public Policy Center, “Racial and Socioeconomic Test-Score Gaps In New England Metropolitan Areas: State School Aid and Poverty Segregation,” Federal Reserve Bank of Boston senior economist and policy advisor Katharine Bradbury explores factors associated with unequal educational opportunity and how they relate to test-score gaps in New England’s metropolitan areas.

What factors contribute to unequal educational opportunity?

While educational achievement depends on many factors, from teacher quality to parental support, among many others, in this report I explore two that my research determined are strongly associated with test-score gaps in metropolitan areas: how state aid for education is distributed and the degree of poverty segregation in metro areas.

How do test-score gaps in New England metropolitan areas compare with those in other places?

Test-score gaps in New England’s metropolitan areas are relatively large. On average, they are above the U.S. metro-area average and also larger compared with the averages in most other U.S. regions. Within New England, test-score gaps are larger in Connecticut metro areas, on average, when compared to metro areas in the other New England states.

How does the way that states provide funding to local school districts – state aid – relate to test-score gaps?

I find a fairly strong relationship between test-score gaps and the progressivity of state education aid – how disproportionately state aid is distributed to districts with high fractions of students living in poverty. Specifically, test-score gaps are smaller in high-poverty metropolitan areas where state school funding for local school districts is more progressive.

Does that finding suggest that New England states should make their state aid distributions more progressive?

To be clear, my research does not show that progressive state aid causes a reduction in test-score gaps, only that there is a relationship or correlation between these two factors. Nonetheless, there are other good reasons to direct state funds for education disproportionately to high-poverty school districts. Primarily, students in these districts cost more to educate. My colleague Bo Zhao recently released a report that quantifies these costs in Connecticut school districts and recommends how state aid there could better reflect these costs.

Your research also explores the relationship between poverty segregation and test-score gaps. How segregated is New England?

Test-score gaps between students of different races and different socioeconomic statuses are smaller in places where low-income students are less segregated across and within school districts. For example, considering test-score gaps between white and Black students, what matters most is the racial difference in the average fraction of their peers who are low income. So the largest challenge is not racial segregation per se, it's poverty segregation. Residential segregation by race and by income is substantial in New England metropolitan areas, which means that the segregation of low-income students between districts is substantial: Within many of the region’s metro areas, some districts enroll many low-income students and other districts enroll almost no low-income students.

Are there policies that could help reduce poverty segregation in New England metro areas?

Because the challenge in New England is segregation between the region’s many small school districts, determining an appropriate policy response is complicated. Policies that encourage more income integration across communities and school districts could help. Massachusetts and Rhode Island both have policies that create statewide incentives for affordable housing production, which could help both minority families and low-income families move to higher-income areas where school quality seems better.

This interview was conducted by Darcy Saas, deputy director at the New England Public Policy Center.