School District Responses to Variations in the Cost of Purchasing Resources.

notion of school finance equity states that among the school districts in a state the educational resources per pupil should be equally distributed. This equity notion raises the problem that the purchasing power of the education dollar varies among school districts.1 Since the cost of purchasing resources varies among districts, an equal level of revenues per pupil among districts will fail to purchase an equal bundle of educational resources. This study employs multiple regression analysis of 616 Ohio school districts to test how districts respond to the variation in resource costs and to test the extent to which state and federal aid systematically compensate for these resource cost differences.