Education is one of the most important government expenditure components in most of the countries; this is justified by positive impacts on welfare. The arguments for educational investment are typically related with gains for the society as a whole (externalities) which makes plausible that people is willing to pay for the others’ education; then there are also equity concerns on these investments.
Generally, it is relatively easy to point several potential externalities such as crime reduction (more educated people tend to earn more money and they are less likely to commit crimes), political participation (more educated people tend to be more careful with political decisions and monitor them through voting) or even a more healthy society (higher levels of education seem to lead to more health awareness and preventive behavior).
At the first sight, the possibility of having negative side effects caused by education does not seem to be credible but they may exist. Increasing the school attendance and mandatory drop-out age is a good example: On one hand, it tends to decrease crime because students have less time available and it education may change individual’s behavior. On the other hand, individuals that are more likely to quit school and are forced by law to continue may cause negative externalities to the others. “Forced students” may reduce class quality with a “distracting/noisy” behavior. Indirectly, the previous policy can lead to larger classes and an increase of demand for teachers can reduce the average teacher quality (necessary hire lower quality teachers to match the demand for education) which have an effect on educational outcomes.
Andersen, Hansen and Walker (2012) analyze the impact of an increase of mandatory drop-out age on student victimization in the United States. The authors find that increasing minimum dropout ages increase the probability that females and younger students report missing days of school for fear of their safety and younger students are more likely to report being threatened or injured with a weapon on school property. They conclude that this policy replaces the place of crime and delinquency: from the streets to schools.
As in every policy, we should not be tempted to measure only the benefits and be careful on how to measure benefits. In the previous example, we should be careful when measuring the impact of schooling on criminality because there may be a crime reduction in the end but we cannot forget that there is a trade-off between street and school crimes and its consequences.
Guilherme Rodrigues 541
 There is some evidence on the negative impact of class size on educational outcomes but it is not consensual in the literature.
 Anderson, D. Mark, B. Hansen and M. B. Walker, 2012 ” The minimum dropout age and student victimization”, Economics of Education Review