School Choice and the Flight to Private Schools: To What Extent Are Public and Private Schools Substitutes?

Opponents of school choice sometimes charge that vouchers, charter schools, and tuition tax credits would strip funding and talented students from the public schools. Proponents say this is exactly what is needed to provide extra competition for public schools. Flight to private schools may happen if parents think private schools are good substitutes for public schools. For goods with explicit market prices, economists estimate substitutability by specifying a demand curve and finding a cross price elasticity, but the non-market nature of schooling has prevented this. The current study finds a way to estimate the demand for public schooling and calculate a cross price elasticity by exploiting Rosen’s (1974) two-stage hedonic technique. It estimates the cross price elasticity between public schooling and the price of private schooling to be 0.32: Americans view private schools as fairly weak substitutes for public schools. The use of spatial statistics accounts for potential spillovers and omitted variable bias in the house price hedonics and the demand curve estimation. In fact, the -1.72 price elasticity of demand is much larger than the -0.20 to -0.40 estimates generally found by non-spatial studies.

Which Measures of School Quality Does the Housing Market Value?

This study explores which measures of public school quality the housing market values. Both a traditional hedonic house price estimation and a hedonic corrected for spatial autocorrelation are used. Proficiency tests, expenditure per pupil and the pupil / teacher ratio are consistently capitalized into housing prices. Teacher salary and student attendance rates are also valued, but these results are sensitive to the estimation technique employed. Value-added measures, the graduation rate, teacher experience levels and teacher education levels are not consistently positively related to housing prices, so researchers should probably avoid using them as public education quality measures.

The Demand for Educational Quality: Combining a Median Voter and Hedonic House Price Model

Communities differ in both the bundle of amenities offered to residents and the implicit price of these amenities. Thus, households are faced with a choice of which bundle to select when they select their residence. This choice implies households make tradeoffs among the amenities; that is, the amenities are substitutes or complements. We focus on estimating the demand for one of the most important amenities -- public school quality. We use transaction prices from the housing market and the hedonic house price model to generate the implicit prices of community amenities. The median voter model is used to estimate the income and price elasticities of demand for educational quality. We find that the own price elasticity of demand for schooling is about -0.5 and the income elasticity of demand is about 0.5. New findings include estimates of a set of cross-price elasticities of demand for school quality. We find that a community’s income level, percentage white households, and level of public safety are substitutes for school quality.

Public and Private School Competition: The Spatial Education Production Function

School vouchers may increase the competition public school districts face. Greater competition may spur public schools to improve student outcomes, which reliably predict labor market productivity and earnings. Previous school competition studies do not use spatial statistics; they fail to incorporate spillovers and the effect of omitted variables into their education production functions. Significant spatial effects are found in all regressions, and spatial statistics improves adjusted R-squared. There seems to be no consistent association between private school attendance rates and public school achievement, or between the number of public school districts in a county and public school performance. Competitive effects, which seem plausible in non-spatial regressions, dissipate when spatial statistics is used. When school inputs appeared statistically significant in non-spatial regressions, the spatial regressions generally made the significance disappear. Poverty appeared to depress reading and writing passage rates, but this effect disappeared in the spatial models.

House Prices and School Quality: Instruments, Signaling, Usage and Perceptions

Abstract We identify commonly-available instrumental variables for housing hedonics for proficiency tests, school spending, and property taxes. We estimate the hedonic simultaneously with the reasons a person bought his house. We find larger housing value elasticities than previous studies: 0.47 for test scores, 1.07 for expenditures per pupil, and -0.37 for property taxes. We suggest schooling expenditures acts as a signaling mechanism. We find that people who use private schools and think their private school is excellent pay an additional 10% house price premium; this finding, along with capitalization of private school test scores, supports the theory of the marginal consumer

House Price Impacts of Racial, Income, Education, and Age Neighborhood Spatial Concentration

Abstract We study the relationship between house prices and segregation. We find racial segregation is positively related to house prices, with a 0.024 elasticity. Increasing income segregation by 10% is related to a 2.7% increase in house price. On the other hand, the housing market values diversity in educational attainment. Increasing neighborhood educational segregation by 10% is related to a 2.4 discount in housing prices, all else constant. Age heterogeneity is not related to house prices

Variable responses of individual species to tropical forest degradation

The functional stability of ecosystems depends greatly on interspecific differences in responses to environmental perturbation. However, responses to perturbation are not necessarily invariant among populations of the same species, so intraspecific variation in responses might also contribute. Such inter-population response diversity has recently been shown to occur spatially across species ranges, but we lack estimates of the extent to which individual populations across an entire community might have perturbation responses that vary through time. We assess this using 524 taxa that have been repeatedly surveyed for the effects of tropical forest logging at a focal landscape in Sabah, Malaysia. Just 39 % of taxa – all with non-significant responses to forest degradation – had invariant responses. All other taxa (61 %) showed significantly different responses to the same forest degradation gradient across surveys, with 6 % of taxa responding to forest degradation in opposite directions across multiple surveys. Individual surveys had low power (< 80 %) to determine the correct direction of response to forest degradation for one-fifth of all taxa. Recurrent rounds of logging disturbance increased the prevalence of intra-population response diversity, while uncontrollable environmental variation and/or turnover of intraspecific phenotypes generated variable responses in at least 44 % of taxa. Our results show that the responses of individual species to local environmental perturbations are remarkably flexible, likely providing an unrealised boost to the stability of disturbed habitats such as logged tropical forests