districts. Some exceptions to this are the occasional discussion of whether commercial or utility property should be made a statewide asset for school finance purposes or whether a major change in the school finance system will result in such large changes in residential property values as to undo the intended direction of equity (i.e., will changes be capitalized into property values in ways that make unclear the direction of change for taxpayers' real tax burdens?). But aside from these occasional discussions of commercial property or capitalization, the vast majority of school finance work on taxpayer equity has not used public finance ideas.9

The Unit of Analysis

States, districts, schools, and students grouped by socioeconomic or other characteristics have all been used as units of analysis in school finance equity analyses. The federal government and analysts have often compared and ranked states according to their school finance equity. Common questions using the state as the unit of analysis are (1) Is state A more equitable than state B? and (2) Has equity improved in state C? For any given state, the unit in most instances is the district because the financing and provision of public education are carried out largely through local school districts. Within districts, schools have been important in two court cases and, in urban districts with large numbers of schools, researchers and policymakers are increasingly interested in intra-district equity. In addition, the school reform movement that emphasizes school-based decision making, including budgetary decisions, potentially elevates the school to a position of particular interest.10 Although the individual student is rarely the unit of analysis, groups of students (e.g., poor versus rich, minority versus non-minority, handicapped versus non-handicapped) have been used in some analyses. The unit of analysis issue is often resolved with at least one eye on data availability and another on the politics of school finance, the latter focusing on where the power to change lies, which is often with the state or district. Political issues involved in equity of school financing are discussed by Carr and Fuhrman (Chapter 5 of this volume).

Inputs, Processes, Outputs, and Outcomes

One way to understand different approaches to school finance equity is to examine the varying emphases on different stages in the "production" of education. Some definitions of equity focus on inputs—labor, equipment, capital—in their dollar or raw unit forms. That is, the ideal is to have these inputs distributed equitably, which is not necessarily equally. Sometimes the discussion ends here with an assertion that it is inputs, measured in dollars, that should be the focus of school finance equity. In other cases the idea of equity goes beyond inputs to something further along in the education production process. For example, concern



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