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Private versus public schools in post-Apartheid South African cities: theory and policy implications

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  • Selod, Harris
  • Zenou, Yves

Abstract

Black and white families are heterogenous both in income and ability and simultaneously decide where to locate in the city and which school (private or public) to send their children. We show that, in equilibrium, despite the tuition fees imposed by whites, some black pupils may attend the private school. In fact three different equilibrium regimes can occur: either all, some, or none of the black pupils attend the private school. In all three cases, white families reside close to the private school attended by their children whereas black families locate further away. This market solution is shown not to be optimal, one of the reasons being that whites overprice education in order to limit black attendance at the private school, protecting their children from negative human capital externalities. Three types of education policies publicly financed by an income tax are then considered: transportation subsidies, private-school vouchers and public school spending. The efficiency of such policies depends on the fee-setting behaviour of whites, which strongly varies from one policy to another.
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  • Selod, Harris & Zenou, Yves, 2003. "Private versus public schools in post-Apartheid South African cities: theory and policy implications," Journal of Development Economics, Elsevier, vol. 71(2), pages 351-394, August.
  • Handle: RePEc:eee:deveco:v:71:y:2003:i:2:p:351-394
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    Cited by:

    1. Selod, Harris & Zenou, Yves, 2003. "Private versus public schools in post-Apartheid South African cities: theory and policy implications," Journal of Development Economics, Elsevier, pages 351-394.
    2. Lam, David & Ardington, Cally & Leibbrandt, Murray, 2011. "Schooling as a lottery: Racial differences in school advancement in urban South Africa," Journal of Development Economics, Elsevier, vol. 95(2), pages 121-136, July.
    3. Yamauchi, Futoshi, 2004. "Race, equity, and public schools in post-apartheid South Africa," FCND discussion papers 182, International Food Policy Research Institute (IFPRI).
    4. Yamauchi, Futoshi, 2005. "Race, equity, and public schools in post-Apartheid South Africa: Equal opportunity for all kids," Economics of Education Review, Elsevier, vol. 24(2), pages 213-233, April.
    5. Brueckner, Jan K. & Selod, Harris, 2006. "The political economy of urban transport-system choice," Journal of Public Economics, Elsevier, pages 983-1005.
    6. O'Gorman, Melanie, 2010. "Racial earnings inequality in South Africa: An assessment of policy options," Journal of Policy Modeling, Elsevier, vol. 32(6), pages 703-718, November.
    7. Somekh, Babak, "undated". "Shopping In A Segregated City," Working Papers WP2014/5, University of Haifa, Department of Economics.
    8. Yamauchi, Futoshi, 2011. "School quality, clustering and government subsidy in post-apartheid South Africa," Economics of Education Review, Elsevier, vol. 30(1), pages 146-156, February.
    9. Bidisha Chakraborty & Manash Ranjan Gupta, 2006. "A Note on the Inclusion of Human Capital in the Lucas Model," International Journal of Business and Economics, College of Business and College of Finance, Feng Chia University, Taichung, Taiwan, vol. 5(3), pages 211-224, December.
    10. Carman, Katherine Grace & Zhang, Lei, 2012. "Classroom peer effects and academic achievement: Evidence from a Chinese middle school," China Economic Review, Elsevier, vol. 23(2), pages 223-237.
    11. George R.G. Clarke & James Habyarimana & Michael Ingram & David Kaplan & Vijaya Ramachandran, 2007. "An Assessment of the Investment Climate in South Africa," World Bank Publications, The World Bank, number 6738.
    12. Somekh, Babak, "undated". "Commuting And Shopping: Determinants Of City Income Structure," Working Papers WP2012/3, University of Haifa, Department of Economics.
    13. Selod, Harris & Zenou, Yves, 2003. "Private versus public schools in post-Apartheid South African cities: theory and policy implications," Journal of Development Economics, Elsevier, pages 351-394.

    More about this item

    JEL classification:

    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • I20 - Health, Education, and Welfare - - Education - - - General
    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns

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