The Financial Consequences of Education and Food Safety Policies on Local Budgets

This dissertation sheds light on the financial consequences of education and food safety policies on public expenditures and revenues. Even when unstated in central policy goals, studying budgetary responses to these public policies may shed light on why and how policies achieve their intended goals or help explain why they do not. In paper 1, I provide evidence on the extent to which school choice effects school budgets, comparing schools that face increased competition from school choice to those that do not. Using a change in New York City high school assignment policy --- to centralized open enrollment --- as an exogenous change, I employ difference-in-differences and school fixed effects models to estimate the impact of school competition on school budgets, noting that changes in competition vary by admissions method and demand. I find evidence that zoned, unscreened, and schools in low demand increase per pupil expenditures on non-instructional functions in response to increased competition, taking resources from instructional functions. Conversely, schools that always compete do not substantially change expenditures in response to the policy change. These results imply that schools may face important tradeoffs when competing for students, including tradeoffs between quantity and academic quality of applicants and tradeoffs between incentives to reach necessary enrollment levels and to improve academic outcomes.;In paper 2, I estimate the effect of school finance reforms on the relationship between district resources and racial composition. State funding formulas do not explicitly include race, but share of students who are of each race may still affect state aid per pupil. I study this by looking at changes in state aid as share of district students who are non-White increases and estimating the extent to which school finance reform breaks this link. Consistent with previous literature, I find that state aid has a disparate racial impact. Moreover, in addition to large positive impacts of school finance reform on mean state aid per pupil, I also find small positive impacts of school finance reform for share of students who are Black, Hispanic and American Indian; I find a negative effect for share who are Asian. In turn, local revenues may respond to changes in state funding potentially crowding out the effect of school finance reform on total revenues --- I explore these responses as well. Local revenue responses do partially offset state aid effects, but impacts are much smaller; the effects on total revenue are similar to the effects on state aid. To test the robustness of the findings, I estimate the impact of school finance reform on percent changes in revenues, over time in post-reform years, and controlling for additional district cost and revenue factors available in New York State data, but unavailable nationally. The results are largely consistent across alternative model specifications and robust to additional control variables in New York State, suggesting school finance reform can change the link between district resources and minority representation.;Paper 3 presents estimates of the impact of public restaurant grades on economic activity and public resources in NYC. Using a difference-in-differences strategy with controls for restaurant characteristics and underlying food safety compliance, I find that A grades reduce probability of closure and increase restaurant revenues, while increasing sales taxes remitted and decreasing fines relative to B grades. Conversely, C grades increase probability of closure and decrease restaurant revenues, while decreasing sales taxes remitted relative to B grades. These findings suggest that policymakers may be able to incorporate public information efforts into their regulatory approach with positive financial implications for the private and public sectors.;Together, these findings imply that financial consequences of policies are sometimes different than their stated objectives. Decision-makers should consider how responses to policies may alter their costs and returns, even when those consequences are unstated and possibly unintended.