Precarious Slopes? The Great Recession, Federal Stimulus, and New Jersey Schools

Museum & Visits Regional Economy Data & Statistics Careers Blog Press Center

About the New York Fed
- About the New York Fed
- What We Do
- Who We Are
  - Bank Leadership
  - Diversity and Inclusion
- Communities We Serve
- Governance
- More About Us
- At the New York Fed, our mission is to make the U.S. economy stronger and the financial system more stable for all segments of society. We do this by executing monetary policy, providing financial services, supervising banks and conducting research and providing expertise on issues that impact the nation and communities we serve.
  
  The New York Innovation Center bridges the worlds of finance, technology, and innovation and generates insights into high-value central bank-related opportunities.
  
  Do you have a request for information and records? Learn how to submit it.
  
  Learn about the history of the New York Fed and central banking in the United States through articles, speeches, photos and video.
Markets & Policy Implementation

Economic Research
- Economic Research
- U.S. Economy
  - Consumer Expectations & Behavior
  - Growth & Inflation
  - Labor Market
  - Financial Stability
  - Banking
- REGIONAL ECONOMY
- RESEARCHERS
  - PUBLICATIONS
  - RESEARCH CENTERS
  - CALENDAR

Financial Institution Supervision
- Financial Institution Supervision
- Supervision & Regulation
  - Circulars
  - Regulations
- Reporting Forms & Instructions
  - Reporting Forms
  - Correspondence
- Bank Applications
- Consumer Protection
  - Community Reinvestment Act Exams
  - Frauds and Scams
- As part of our core mission, we supervise and regulate financial institutions in the Second District. Our primary objective is to maintain a safe and competitive U.S. and global banking system.
  
  The Governance & Culture Reform hub is designed to foster discussion about corporate governance and the reform of culture and behavior in the financial services industry.
  
  Need to file a report with the New York Fed? Here are all of the forms, instructions and other information related to regulatory and statistical reporting in one spot.
  
  The New York Fed works to protect consumers as well as provides information and resources on how to avoid and report specific scams.
Financial Services & Infrastructure
- Financial Services & Infrastructure
- Financial Services & Operations
- Financial Market Infrastructure & Reform
- The Federal Reserve Bank of New York works to promote sound and well-functioning financial systems and markets through its provision of industry and payment services, advancement of infrastructure reform in key markets and training and educational support to international institutions.
  
  The New York Innovation Center bridges the worlds of finance, technology, and innovation and generates insights into high-value central bank-related opportunities.
  
  The growing role of nonbank financial institutions, or NBFIs, in U.S. financial markets is a transformational trend with implications for monetary policy and financial stability.
  
  The New York Fed offers the Central Banking Seminar and several specialized courses for central bankers and financial supervisors.
Community Development
& Education

Economic Policy Review Executive Summary

Precarious Slopes? The Great Recession, Federal Stimulus, and New Jersey Schools

Recapping an article from the December 2013 issue of

Contact authors

the Economic Policy Review, Volume 19, Number 2

View full article PDF

25 pages / 1,138 kb

Authors: Rajashri Chakrabarti and Sarah Sutherland

Disclaimer
Index of executive summaries

The Great Recession was marked by a downturn in housing prices, employment, and business activity, each of which led to reduced tax revenues and larger budget gaps.
These shortfalls impacted the ability of state and local governments to fully fund schools.
Chakrabarti and Sutherland investigate the downturn’s effect on New Jersey school finances, finding strong evidence of downward shifts in total school funding and expenditures, relative to trend.
The authors find that budgetary stress likely led to sizable layoffs of nontenured teachers; they also observe that high-poverty and urban school districts sustained larger resource declines than more affluent and less populated districts did.
However, support of more than $2 billion from federal American Recovery and Reinvestment Act funding limited damage to New Jersey’s budget; importantly, it helped preserve funding levels closely associated with student instruction.
The study offers valuable insight into how school districts fare during downturns and serves as a useful guide for future policy decisions.

About the Authors

Rajashri Chakrabarti is an economist at the Federal Reserve Bank of New York; Sarah Sutherland is a research associate at the Bank.

Disclaimer

The views expressed in this summary are those of the authors and do not necessarily reflect the position of the Federal Reserve Bank of New York or the Federal Reserve System.

By continuing to use our site, you agree to our Terms of Use and Privacy Statement. You can learn more about how we use cookies by reviewing our Privacy Statement.