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Strategic interaction among public school districts: Evidence on spatial interdependence in school inputs

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  • Ghosh, Soma

Abstract

This paper provides evidence on strategic interaction among public school districts in Massachusetts. The open enrollment program in Massachusetts is unique in testing the strategic competition thesis because it allows students to attend public schools located outside their home district. For each student who transfers out, funds are deducted from the sending district's local aid distribution and added to the receiving district's local aid. Thus, school districts no longer have the assurance of a ready supply of students and funding, instead they have to compete with neighboring districts, and enact strategies that will help retain as well as attract more students. A spatial econometric framework is applied to disentangle the correlation due to strategic interaction from the one that is simply due to spatially correlated error shocks. The results show that public school districts respond positively to the expenditure decisions of neighboring districts, thereby acting strategically when setting their own spending levels.

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  • Ghosh, Soma, 2010. "Strategic interaction among public school districts: Evidence on spatial interdependence in school inputs," Economics of Education Review, Elsevier, vol. 29(3), pages 440-450, June.
    • Handle: RePEc:eee:ecoedu:v:29:y:2010:i:3:p:440-450
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    3. Gu Jiafeng & Shen Tiyan & Zhang Jiadong, 2015. "Can Financial Shortages in China’s Education Be Contagious?," Journal of Systems Science and Information, De Gruyter, vol. 3(3), pages 193-213, June.
    4. Ivo Bischoff & Julia Hauschildt, 2017. "Vocational Schools as an Instrument of Interregional Competition – Empirical Evidence from German Counties," MAGKS Papers on Economics 201722, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    5. Wang, Jian & Wu, Qun & Yan, Siqi & Guo, Guancheng & Peng, Shangui, 2020. "China’s local governments breaking the land use planning quota: A strategic interaction perspective," Land Use Policy, Elsevier, vol. 92(C).
    6. Kalinca Léia Becker, 2023. "An analysis of Fundeb's contribution to the quality of public education in Brazilian municipalities," Review of Development Economics, Wiley Blackwell, vol. 27(2), pages 879-896, May.
    7. Mattia Cattaneo & Paolo Malighetti & Michele Meoli & Stefano Paleari, 2017. "University spatial competition for students: the Italian case," Regional Studies, Taylor & Francis Journals, vol. 51(5), pages 750-764, May.
    8. Ivo Bischoff & Julia Hauschildt, 2019. "Vocational schools as an instrument of interregional competition—Empirical evidence from German counties [Berufsschulen als Instrument im interregionalen Wettbewerb – Ergebnisse einer Analyse für d," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 39(1), pages 65-89, February.
    9. Jacob Fowles, 2016. "Salaries in Space," Public Finance Review, , vol. 44(4), pages 523-548, July.
    10. López-Torres, Laura & Nicolini, Rosella & Prior, Diego, 2017. "Does strategic interaction affect demand for school places? A conditional efficiency approach," Regional Science and Urban Economics, Elsevier, vol. 65(C), pages 89-103.
    11. Gu Jiafeng, 2014. "Spatial Dynamics, Vocational Education and Chinese Economic Growth," Journal of Systems Science and Information, De Gruyter, vol. 2(5), pages 385-400, October.

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