Returns to school resources in the Jim Crow South

We estimate returns to school resources in the Jim Crow era, as measured by young males' 1940 wage earnings, occupational status, and cognitive aptitude scores. Results point to a 16 cent annual return on each $1 invested in public schools. To the question of whether some school inputs mattered more than others, we find comparable 25-32 cent returns per dollar invested in extended school years, teacher salaries, and smaller classes. School spending and inputs had much more bearing on labor market outcomes than aptitude scores. We document diminishing returns to school expenditures, which, in combination with segregated schools, resulted in higher returns to expenditures in black schools relative to white.