School Segregation in the Presence of Student Sorting and Cream-Skimming

Gazmuri, Ana (2017) School Segregation in the Presence of Student Sorting and Cream-Skimming: Evidence from a School Voucher Reform. , Toulouse

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Official URL: http://tse-fr.eu/pub/32147

Abstract

Critics of school choice argue that when private schools compete with public schools, they select the best public school students (cream-skim), increasing socioeconomic segregation. I study the mechanisms that underlie student sorting in a mixed public-private system using a 2008 education reform implemented in Chile aimed at decreasing education inequality. Specifically, I exploit the shock to schools' incentives to test for whether schools select students based on socioeconomic characteristics. I show that low-SES parents' school choices are restricted by private school cream-skimming behavior. I estimate a demand model incorporating these admissions restrictions to capture parents' preferences for different school characteristics and peer composition. I show that ignoring cream-skimming leads to underestimating poor parents' preferences for school quality. My model shows that heterogeneous parental preferences for high-SES peers seem to be the main driver behind socioeconomic segregation. I find that the decrease in cream-skimming induced by Chile's reform led to lower public school enrollment, and that strong preferences for high-SES peers drove increased enrollment in schools that opted out of the reform. Overall, this led to increased segregation, especially in more competitive markets.

Item Type: Monograph (Working Paper)
Sub-title: Evidence from a School Voucher Reform
Language: English
Date: September 2017
Place of Publication: Toulouse
Subjects: B- ECONOMIE ET FINANCE
Divisions: TSE-R (Toulouse)
Institution: Université Toulouse 1 Capitole
Site: UT1
Date Deposited: 17 Apr 2018 08:15
Last Modified: 17 Apr 2018 08:15
OAI ID: oai:tse-fr.eu:32147
URI: http://publications.ut-capitole.fr/id/eprint/25723

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