The explosion of research work on the economics of education has covered a wide range of issues. A key element of modern analyses is a focus on the outcomes of schooling and how various factors affect outcomes. Along with this, there has been considerable attention to production relationships and particularly to efficiency of production. The existing work suggests that variations in how well schools convert resources and inputs into student learning are a very important issue that has direct implications for education policy. Because commonly measured characteristics of teachers and schools – such as teacher experience, teacher degree levels, or class size – are not consistently related with student outcomes, the research suggests that these are not good policy instruments. On the other hand, the strong evidence about the importance of teacher quality points toward noticeable changes in the finance and governance of schools.