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The effect of school finance reform on population heterogeneity

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  • Daniel Aaronson

Abstract

This paper tests whether state school finance reform alters neighborhood income homogeneity. One implication of the Tiebout model is that within-community homogeneity declines as a result of an exogenous decrease in the ability of jurisdictions to set local tax and expenditure levels. The property tax revolt and the school finance equalization reform of the 1970s and 1980s offer a test of the role of state fiscal reform on aggregate population sorting behavior. The results show that school finance has a significant effect on school district income sorting, especially among low income communities.

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Bibliographic Info

Paper provided by Federal Reserve Bank of Chicago in its series Working Paper Series with number WP-98-11.

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Date of creation: 1998
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Handle: RePEc:fip:fedhwp:wp-98-11

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Keywords: Education ; Income ; Finance;

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References

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Citations

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Cited by:
  1. Katherine Baicker & Nora Gordon, 2004. "The Effect of Mandated State Education Spending on Total Local Resources," NBER Working Papers 10701, National Bureau of Economic Research, Inc.
  2. Farnham, Martin & Sevak, Purvi, 2006. "State fiscal institutions and empty-nest migration: Are Tiebout voters hobbled?," Journal of Public Economics, Elsevier, vol. 90(3), pages 407-427, February.
  3. Thomas A. Downes & David N. Figlio, 1999. "Economic inequality and the provision of schooling," Economic Policy Review, Federal Reserve Bank of New York, issue Sep, pages 99-110.
  4. Maria Marta Ferreyra, 2008. "An Empirical Framework for Large-Scale Policy Analysis, with an Application to School Finance Reform in Michigan," 2008 Meeting Papers 609, Society for Economic Dynamics.
  5. Gordon, Nora, 2004. "The Effect of Mandated State Education Spending in Total Local Resources," Santa Cruz Department of Economics, Working Paper Series qt2jg817p3, Department of Economics, UC Santa Cruz.
  6. Sean Corcoran & William N. Evans, 2010. "Income Inequality, the Median Voter, and the Support for Public Education," NBER Working Papers 16097, National Bureau of Economic Research, Inc.
  7. Baicker, Katherine & Gordon, Nora, 2006. "The effect of state education finance reform on total local resources," Journal of Public Economics, Elsevier, vol. 90(8-9), pages 1519-1535, September.
  8. Rajashri Chakrabarti & Joydeep Roy, 2012. "Housing markets and residential segregation: impacts of the Michigan school finance reform on inter- and intra-district sorting," Staff Reports 565, Federal Reserve Bank of New York.
  9. Thomas A. Downes, 2002. "Do state governments matter?: a review of the evidence on the impact on educational outcomes of the changing role of the states in the financing of public education," Conference Series ; [Proceedings], Federal Reserve Bank of Boston, vol. 47(Jun), pages 143-180.
  10. Aaronson, Daniel, 2001. "Neighborhood Dynamics," Journal of Urban Economics, Elsevier, vol. 49(1), pages 1-31, January.
  11. Dennis N. Epple & Maria Marta Ferreyra, 2007. "School Finance Reform: Assessing General Equilibrium Effects," NBER Working Papers 13524, National Bureau of Economic Research, Inc.
  12. Joydeep Roy, 2004. "Effect of a School Finance Reform on Housing Stock and Residential Segregation: Evidence from Proposal A in Michigan," Public Economics 0412004, EconWPA.
  13. Epple, Dennis & Ferreyra, Maria Marta, 2008. "School finance reform: Assessing general equilibrium effects," Journal of Public Economics, Elsevier, vol. 92(5-6), pages 1326-1351, June.
  14. Katherine Baicker & Nora Gordon, 2004. "The Effect of Mandated State Education Spending on Total Local Resources (new title: The effect of state education finance reform on total local resources)," CESifo Working Paper Series 1275, CESifo Group Munich.

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