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

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I develop a model of competition between charter schools and traditional public schools and estimate the model using administrative data from North Carolina. The model allows peers to affect the production of student achievement. I use the model to quantify how existing charter schools have affected test scores for both charter and public school students and to simulate how lifting binding caps on charters would affect charter school entry and student test scores. The structural model renders a comprehensive and internally consistent picture of treatment effects, and highlights heterogeneity that studies based on subsets of schools or students may not be able to recover. In particular, I find that i) contextual peer effects are large at public schools but do not significantly affect test scores for students at charters, ii) the mean effect of charter schools on attendant students (direct effect) is 11% of a standard deviation, iii) there is substantial heterogeneity in the mean direct effect by market, including many markets where the mean direct effect is negative, iv) the mean spillover effect on public school students is positive, but marginal, v) lifting caps on charter schools would more than double entry and cause much smaller increases in mean test scores for attendant students.

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Bibliographic Info

Paper provided by University of Western Ontario, CIBC Centre for Human Capital and Productivity in its series University of Western Ontario, CIBC Centre for Human Capital and Productivity Working Papers with number 20123.

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Date of creation: 2012
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Handle: RePEc:uwo:hcuwoc:20123

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Postal: CIBC Centre for Human Capital and Productivity, Social Science Centre, University of Western Ontario, London, Ontario, Canada N6A 5C2
Phone: 519-661-2111 Ext.85244
Web page: http://economics.uwo.ca/research/research_papers/cibc_workingpapers.html

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Keywords: School Choice; Charter Schools; Education; Structural Estimation; General Equilibrium; Treatment Effects;

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  1. Sundaram,Rangarajan K., 1996. "A First Course in Optimization Theory," Cambridge Books, Cambridge University Press, number 9780521497190, December.
  2. Rajashri Chakrabarti, 2005. "Can Increasing Private School Participation and Monetary Loss in a Voucher Program Affect Public School Performance? Evidence from Milwaukee," Public Economics 0512003, EconWPA.
  3. Scott Imberman, 2009. "The Effect of Charter Schools on Achievement and Behaviorof Public School Students," Working Papers 2009-02, Department of Economics, University of Houston.
  4. Sundaram,Rangarajan K., 1996. "A First Course in Optimization Theory," Cambridge Books, Cambridge University Press, number 9780521497701, December.
  5. 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.
  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. 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.
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