Using feedback simulation to test educational finance policies

A system dynamics model of the dynamics of special education reimbursement policies, based upon work completed in Massachusetts, is presented. The model is used to analyze the causes of unstable growth in special education costs and to propose policy options for controlling such costs. Because of an elaborated ability to represent the behaviors of local school districts, the system dynamics technology was found to be ideally suited to this type of policy analysis. However, the existence of the elaborated feedback structure would make it extremely cumbersome to use the system dynamics model to project annual costs on a locality-by-locality basis, such projections being the principal strength of traditional education finance models. This trade-off between two modeling technologies suggests that analysts must carefully match their audience, purpose, and modeling technology to attain best analyses.