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Competition in Public School Districts: Charter School Entry, Student Sorting, and School Input Determination

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  • Nirav Mehta

    (University of Western Ontario)

Abstract

The model successfully fits key endogenous outcomes as observed in the data: 1) charter schools enter larger markets and markets where they would have higher per-pupil resources, 2) charter schools and public schools in markets in which charter schools are present both choose higher input levels than public schools in markets where there are no charters, and 3) charter schools have the highest average test scores, followed by public schools in markets with charter school competition, followed by public schools in monopoly markets. I use the estimated model to simulate changes in the test score distribution for three counterfactual scenarios: 1) ban charter schools, 2) lift the currently binding statewide cap on the number of charter schools, and 3) equate charter and public school per-pupil resources. In the first and second counterfactuals, charter school entry increases test scores for students who would attend charters by one fifth of a standard deviation. Test scores for public school students in markets with charter schools increase marginally. Equating charter and public school capital triples the fraction of markets with charters and increases the test scores of students attending charters over the monopoly outcome by an even larger amount.

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Paper provided by Society for Economic Dynamics in its series 2012 Meeting Papers with number 42.

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Date of creation: 2012
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Handle: RePEc:red:sed012:42

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  1. Rajashri Chakrabarti, 2007. "Can increasing private school participation and monetary loss in a voucher program affect public school performance? Evidence from Milwaukee," Staff Reports 300, Federal Reserve Bank of New York.
  2. Imberman, Scott A., 2011. "The effect of charter schools on achievement and behavior of public school students," Journal of Public Economics, Elsevier, vol. 95(7), pages 850-863.
  3. Sundaram,Rangarajan K., 1996. "A First Course in Optimization Theory," Cambridge Books, Cambridge University Press, number 9780521497190, April.
  4. Epple, Dennis & Romano, Richard E, 1998. "Competition between Private and Public Schools, Vouchers, and Peer-Group Effects," American Economic Review, American Economic Association, vol. 88(1), pages 33-62, March.
  5. Austin Nichols, 2003. "VINCENTY: Stata module to calculate distances on the Earth's surface," Statistical Software Components S456815, Boston College Department of Economics, revised 16 Feb 2007.
  6. Robert Picard, 2010. "GEONEAR: Stata module to find nearest neighbors using geodetic distances," Statistical Software Components S457146, Boston College Department of Economics, revised 22 Feb 2012.
  7. Sundaram,Rangarajan K., 1996. "A First Course in Optimization Theory," Cambridge Books, Cambridge University Press, number 9780521497701, April.
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