The non-cognitive returns to class size.

Abstract

We use nationally representative survey data and a research design that relies on contemporaneous within-student and within-teacher comparisons across two academic subjects to estimate how class size affects certain non-cognitive skills in middle school. Our results confirm that smaller 8th-grade classes are associated with improvements in several indicators of school engagement, with effect sizes ranging from 0.05 to 0.09 and smaller effects persisting two years later. Patterns of selection on observed traits and falsification exercises suggest that these results accurately identify (or possibly understate) the causal effects of smaller classes. Given the estimated earnings impact of these non-cognitive skills, the implied internal rate of return from an 8th-grade class-size reduction is 4.6 percent overall, but 7.9 percent in urban schools.