Self-Selection in The State School System
AbstractWith diminishing returns to the peer group, it is optimal social policy to mix chldren in schools. We consider what happens when, contrary to the outcome being determined by a social planner, schools and children are free to seek each other out: with some caveats, this leads to perfect segregation by child quality. It is shown that this is the worst possible outcome. We show also that a competitive system produces the optimal allocation of children to schools.
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Bibliographic InfoPaper provided by Centre for Economic Performance, LSE in its series CEP Discussion Papers with number dp0312.
Date of creation: Nov 1996
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