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Neighborhood Schools, Choice, and the Distribution of Educational Benefits

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  • Dennis Epple
  • Richard Romano

Abstract

School districts in the U.S. typically have multiple schools, centralized finance, and student assignment determined by neighborhood of residence. In many states, centralization is extending beyond the district level as states assume an increasing role in the finance of education. At the same time, movement toward increased public school choice, particularly in large urban districts, is growing rapidly. Models that focus on community-level differences in tax and expenditure policy as the driving force in determination of residential choice, school peer groups, and political outcomes are inadequate for analysis of multi-school districts and, hence, for understanding changing education policies. This paper develops a model of neighborhood formation and tax-expenditure policies in neighborhood school systems with centralized finance. Stratification across neighborhoods and their schools is likely to arise in equilibrium. Consequences of intra-district choice with and without frictions are characterized, including effects on the allocation of students across schools, tax and expenditure levels, student achievement, and household welfare.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 7850.

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Date of creation: Aug 2000
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Publication status: published as Neighborhood Schools, Choice, and the Distribution of Educational Benefits , Dennis N. Epple, Richard Romano. in The Economics of School Choice , Hoxby. 2003
Handle: RePEc:nbr:nberwo:7850

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