IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/16579.html
   My bibliography  Save this paper

Estimating the Cream Skimming Effect of School Choice

Author

Listed:
  • Joseph G. Altonji
  • Ching-I Huang
  • Christopher R. Taber

Abstract

We develop a framework that may be used to determine the degree to which a school choice program may harm public school stayers by luring the best students to other schools. This framework results in a simple formula showing that the "cream-skimming" effect is increasing in the degree of heterogeneity within schools, the school choice takeup rate of strong students relative to weak students, and the importance of peers. We use the formula to investigate the effects of a voucher program on the high school graduation rate of the students who would remain in public school. We employ NELS:88 data to measure the characteristics of public school students, to estimate a model of the private school entrance decision, and to estimate peer group effects on graduation. We supplement the econometric estimates with a wide range of alternative assumptions about school choice and peer effects. We find that the cream skimming effect is negative but small and that this result is robust across our specifications.

Suggested Citation

  • Joseph G. Altonji & Ching-I Huang & Christopher R. Taber, 2010. "Estimating the Cream Skimming Effect of School Choice," NBER Working Papers 16579, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:16579
    Note: CH ED LS PE
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w16579.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Joseph G. Altonji & Todd E. Elder & Christopher R. Taber, 2005. "Selection on Observed and Unobserved Variables: Assessing the Effectiveness of Catholic Schools," Journal of Political Economy, University of Chicago Press, vol. 113(1), pages 151-184, February.
    2. Epple, Dennis & Figlio, David & Romano, Richard, 2004. "Competition between private and public schools: testing stratification and pricing predictions," Journal of Public Economics, Elsevier, vol. 88(7-8), pages 1215-1245, July.
    3. Patrick Bayer & Fernando Ferreira & Robert McMillan, 2007. "A Unified Framework for Measuring Preferences for Schools and Neighborhoods," Journal of Political Economy, University of Chicago Press, vol. 115(4), pages 588-638, August.
    4. Lisa Barrow & Cecilia Elena Rouse, 2008. "School vouchers and student achievement: recent evidence, remaining questions," Working Paper Series WP-08-08, Federal Reserve Bank of Chicago.
    5. Dennis Epple & Richard Romano, 2008. "Educational Vouchers And Cream Skimming," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 49(4), pages 1395-1435, November.
    6. repec:eme:rlepps:v:18:y:1999:i:1999:p:115-140 is not listed on IDEAS
    7. Thomas J. Nechyba, 2003. "Introducing School Choice into Multidistrict Public School Systems," NBER Chapters, in: The Economics of School Choice, pages 145-194, National Bureau of Economic Research, Inc.
    8. Dennis N. Epple & Richard Romano, 2003. "Neighborhood Schools, Choice, and the Distribution of Educational Benefits," NBER Chapters, in: The Economics of School Choice, pages 227-286, National Bureau of Economic Research, Inc.
    9. Elizabeth M. Caucutt, 2002. "Educational Vouchers When There Are Peer Group Effects--Size Matters," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 43(1), pages 195-222, February.
    10. Helen F. Ladd, 2002. "School Vouchers: A Critical View," Journal of Economic Perspectives, American Economic Association, vol. 16(4), pages 3-24, Fall.
    11. 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.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Brunner, Eric J. & Cho, Sung-Woo & Reback, Randall, 2012. "Mobility, housing markets, and schools: Estimating the effects of inter-district choice programs," Journal of Public Economics, Elsevier, vol. 96(7), pages 604-614.
    2. Francisco Martínez Mora, 2003. "Opting-out of Public Education in Urban Economies," Economic Working Papers at Centro de Estudios Andaluces E2003/52, Centro de Estudios Andaluces.
    3. Sinan Sarpça & Kuzey Yılmaz & Eric Hanushek, 2007. "School Choice: Traditional Mechanisms and Extending the Poor's Ability to Choose," Koç University-TUSIAD Economic Research Forum Working Papers 0709, Koc University-TUSIAD Economic Research Forum.
    4. Chakrabarti, Rajashri, 2008. "Can increasing private school participation and monetary loss in a voucher program affect public school performance? Evidence from Milwaukee," Journal of Public Economics, Elsevier, vol. 92(5-6), pages 1371-1393, June.
    5. Machin, Stephen, 2011. "Houses and schools: Valuation of school quality through the housing market," Labour Economics, Elsevier, vol. 18(6), pages 723-729.
    6. Epple, Dennis & Figlio, David & Romano, Richard, 2004. "Competition between private and public schools: testing stratification and pricing predictions," Journal of Public Economics, Elsevier, vol. 88(7-8), pages 1215-1245, July.
    7. Chakrabarti Rajashri, 2013. "Impact of Voucher Design on Public School Performance: Evidence from Florida and Milwaukee Voucher Programs," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 13(1), pages 349-394, July.
    8. Jean-Michel Plassard & Nhu Tran Thi Thanh, 2009. "Liberté de choix des élèves et concurrence des établissements : un survey de l'analyse du pilotage des systèmes éducatifs par les quasi-marchés," Revue d'économie industrielle, De Boeck Université, vol. 0(2), pages 99-130.
    9. Calsamiglia, Caterina & Martínez-Mora, Francisco & Miralles, Antonio, 2020. "School Choice Design, Risk Aversion, and Cardinal Segregation," IZA Discussion Papers 13464, Institute of Labor Economics (IZA).
    10. Pablo González & Alejandra Mizala & Pilar Romaguera, 2002. "Recursos diferenciados a la educación subvencionada en Chile," Documentos de Trabajo 150, Centro de Economía Aplicada, Universidad de Chile.
    11. Brunner, Eric J. & Imazeki, Jennifer, 2008. "Tiebout choice and universal school vouchers," Journal of Urban Economics, Elsevier, vol. 63(1), pages 253-279, January.
    12. Burgess, Simon & Briggs, Adam, 2010. "School assignment, school choice and social mobility," Economics of Education Review, Elsevier, vol. 29(4), pages 639-649, August.
    13. Michela Tincani, 2014. "School Vouchers and the Joint Sorting of Students and Teachers," Working Papers 2014-012, Human Capital and Economic Opportunity Working Group.
    14. Eric J. Brunner & Jennifer Imazeki, 2006. "Tiebout Choice and the Voucher," Working papers 2006-10, University of Connecticut, Department of Economics.
    15. Caterina Calsamiglia & Francisco Martínez-Mora & Antonio Miralles, 2015. "School Choice Mechanisms, Peer Effects and Sorting," Discussion Papers in Economics 15/01, Division of Economics, School of Business, University of Leicester.
    16. Akyol, Metin, 2016. "Do educational vouchers reduce inequality and inefficiency in education?," Economics of Education Review, Elsevier, vol. 55(C), pages 149-167.
    17. Hsieh, Chang-Tai & Urquiola, Miguel, 2006. "The effects of generalized school choice on achievement and stratification: Evidence from Chile's voucher program," Journal of Public Economics, Elsevier, vol. 90(8-9), pages 1477-1503, September.
    18. Chakrabarti, Rajashri, 2013. "Do vouchers lead to sorting under random private school selection? Evidence from the Milwaukee voucher program," Economics of Education Review, Elsevier, vol. 34(C), pages 191-218.
    19. Patrick Bayer & Robert McMillan, 2005. "Choice and Competition in Local Education Markets," NBER Working Papers 11802, National Bureau of Economic Research, Inc.
    20. Simon Burgess & Brendon McConnell & Carol Propper & Deborah Wilson, 2004. "Sorting and Choice in English Secondary Schools," The Centre for Market and Public Organisation 04/111, The Centre for Market and Public Organisation, University of Bristol, UK.

    More about this item

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:16579. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (). General contact details of provider: https://edirc.repec.org/data/nberrus.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.