We study the role of local institutions--that is, school boundaries, school transportation provision, and zoning restrictions--in determining inequalities of educational opportunities for children. Motivated by our empirical findings on how the demand for both neighborhoods and schools responds to quasi-experimental variation in school quality and transportation, we build and estimate a spatial equilibrium model of residential sorting and school choice. We use the estimated model to analyze three policies that aim to improve educational access to economically disadvantaged children: expanding school choice, providing housing vouchers, and upzoning residential neighborhoods. We find that the success of school choice expansion is contingent on integrating transportation services, and that the common assumption in the school choice literature of policy-invariant residential location would lead to opposite implications for the equilibrium change in school composition. The voucher program benefits eligible families, but the benefits fade in equilibrium as the policy is implemented on a large scale. Finally, upzoning is an effective policy in lowering inequality in school composition via a reduction in neighborhood income segregation.
First version, August 2021
I24: Education and Inequality
R23: Urban, Rural, Regional, Real Estate, and Transportation Economics: Regional Migration; Regional Labor Markets; Population; Neighborhood Characteristics
R31: Housing Supply and Markets