Education Production Function and Class-Size Effects in Japanese Public Schools

Education production functions are estimated using student-level achievement data for Japanese students, with emphasis on estimating the causal effect of class size on students' academic performance. The empirical results show that students‟ test scores are strongly affected by individual and family backgrounds, whereas school resource variables and teacher characteristics have a more limited impact. The causal effect of class size, which is currently being politically debated in Japan, is investigated using a regression discontinuity design. The estimation results suggest that class-size reduction has a weak impact on the academic performance of Japanese students.