The effects of education on people's income are well documented in the economics literature, and the benefits of investing in human capital--in terms of both higher earnings and of other economic and social benefits--are popular research topics for economists and other social scientists. The present study explores the effects of public education expenditures on the distribution of income among people living in the 50 states and the District of Columbia. The study's basic premise is that, since a state's income level depends on its residents' educational level then the income distribution within each state is dependent on the distribution of educational levels among its residents. There are, of course, other factors contributing to income level dispersion within a state, and these variables' effects are also considered. This reports chapters are: (1) Income and Poverty Trends and Distribution; (2) Methodology; (3) Empirical Results; and (4) Conclusions. There are two appendixes of summary and supporting tables and a bibliography that combines both referenced and non-referenced citations. The Trends and Distribution chapter discusses income distributions across the fifty states and the District of Columbia and compares other statistical characteristics, such as differences in public education spending. National trends in income equality from 1970 to 2000 are discussed, as well as trends in other state socioeconomic variables. (Contains 3 figures and 15 tables.).