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School choice through relocation: evidence from the Washington, D.C. area

  • Lisa Barrow

In this paper I show how the monetary value that parents place on school quality may be inferred from their choice of residential location. The method identifies the valuation that parents place on school quality from the differential effect that measures of school quality have on the residential choices of households with and without children. I implement the method with data from the U.S. Census for Washington, D.C. using residential location decisions in 1990. For whites I find that school quality is an important determinant of residential choices and that households with children in the top income quintile are willing to pay $3,300 for schools that generate a 100 SAT point advantage. The evidence does not indicate that the choices of African Americans are influenced by school quality, which suggests that this group may be constrained in their location choices.

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Paper provided by Federal Reserve Bank of Chicago in its series Working Paper Series with number WP-99-7.

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Date of creation: 1999
Date of revision:
Handle: RePEc:fip:fedhwp:wp-99-7
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  1. Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64, pages 416.
  2. Jin Huem Park, 1994. "Estimation of Sheepskin Effects and Returns to Schooling Using he Old and the New CPS Measures of Educational Attainment," Working Papers 717, Princeton University, Department of Economics, Industrial Relations Section..
  3. Caroline M. Hoxby, 2000. "Does Competition among Public Schools Benefit Students and Taxpayers?," American Economic Review, American Economic Association, vol. 90(5), pages 1209-1238, December.
  4. Sandra E. Black, 1997. "Do better schools matter? Parental valuation of elementary education," Research Paper 9729, Federal Reserve Bank of New York.
  5. Daniel McFadden, 1996. "Computing Willingness-to-Pay in Random Utility Models," Working Papers _011, University of California at Berkeley, Econometrics Laboratory Software Archive.
  6. Steven T. Berry, 1994. "Estimating Discrete-Choice Models of Product Differentiation," RAND Journal of Economics, The RAND Corporation, vol. 25(2), pages 242-262, Summer.
  7. Daniel McFadden, 1977. "Modelling the Choice of Residential Location," Cowles Foundation Discussion Papers 477, Cowles Foundation for Research in Economics, Yale University.
  8. Bogart, William T. & Cromwell, Brian A., 1997. "How Much More is a Good School District Worth?," National Tax Journal, National Tax Association, vol. 50(2), pages 215-32, June.
  9. repec:tpr:qjecon:v:113:y:1998:i:2:p:553-602 is not listed on IDEAS
  10. Page Marianne, 1995. "Racial and Ethnic Discrimination in Urban Housing Markets: Evidence from a Recent Audit Study," Journal of Urban Economics, Elsevier, vol. 38(2), pages 183-206, September.
  11. Theodore M. Crone, 1998. "House prices and the quality of public schools: what are we buying?," Business Review, Federal Reserve Bank of Philadelphia, issue Sep, pages 3-14.
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