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School districting and the origins of residential land price inequality

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  • Lee, Yong Suk

Abstract

This paper examines how education policy generates residential sorting and changes residential land price inequality within a city. In 1974, Seoul shifted away from an exam based high school admission system, created high school districts and randomly allocated students to schools within each district. Furthermore, the city government relocated South Korea’s then most prestigious high school from the city center to the city periphery in order to reduce central city congestion. I examine how residential land prices change across school districts using a first differenced boundary discontinuity design. By focusing on the immediate years before and after the creation of school districts and using general functional forms in distance, I find that residential land prices increase by about 13% points more on average and by about 26% points across boundaries in the better school district. Furthermore, there is evidence of dynamic sorting whereby the increase in neighborhood income attracts other high schools to relocate in the following years.

Suggested Citation

  • Lee, Yong Suk, 2015. "School districting and the origins of residential land price inequality," Journal of Housing Economics, Elsevier, vol. 28(C), pages 1-17.
    • Handle: RePEc:eee:jhouse:v:28:y:2015:i:c:p:1-17
    DOI: 10.1016/j.jhe.2014.12.002
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    Cited by:

    1. Ellen Greaves & Hélène Turon, 2023. "School choice and neighborhood sorting: Equilibrium consequences of geographic school admissions," Bristol Economics Discussion Papers 24/779, School of Economics, University of Bristol, UK.
    2. Huang, Bin & He, Xiaoyan & Xu, Lei & Zhu, Yu, 2020. "Elite school designation and housing prices-quasi-experimental evidence from Beijing, China✰," Journal of Housing Economics, Elsevier, vol. 50(C).
    3. Dohyo Jeong & Dohyeong Kim & Heba Mohiuddin & Seokmin Kang & Sungyeun Kim, 2023. "Regional Disparity in the Educational Impact of COVID-19: A Spatial Difference-in-Difference Approach," Sustainability, MDPI, vol. 15(16), pages 1-13, August.
    4. Hu, Lirong & He, Shenjing & Luo, Yun & Su, Shiliang & Xin, Jing & Weng, Min, 2020. "A social-media-based approach to assessing the effectiveness of equitable housing policy in mitigating education accessibility induced social inequalities in Shanghai, China," Land Use Policy, Elsevier, vol. 94(C).
    5. Jin, Zhiyun & Wang, Xingrui & Huang, Bin, 2023. "The enrolment reform of schools and housing price: Empirical evidence from Shanghai, China," International Review of Economics & Finance, Elsevier, vol. 84(C), pages 262-273.
    6. Huang, Bin & He, Xiaoyan & Xu, Lei & Zhu, Yu, 2020. "Elite School Designation and Housing Prices: Quasi-Experimental Evidence from Beijing, China," IZA Discussion Papers 12897, Institute of Labor Economics (IZA).
    7. Lee, Yong Suk, 2014. "Exams, districts, and intergenerational mobility: Evidence from South Korea," Labour Economics, Elsevier, vol. 29(C), pages 62-71.
    8. Lirong Hu & Shenjing He, 2024. "Entrance opportunity vs. academic performance: unpacking the nonlinear capitalization effects of multidimensional school qualities on housing sales and rental prices," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-13, December.
    9. Gyeongcheol Cho & Younyoung Choi & Ji-Hyun Kim, 2020. "Investigating the Unintended Consequences of the High School Equalization Policy on the Housing Market," Sustainability, MDPI, vol. 12(20), pages 1-9, October.
    10. Fang Wei & Lvwang Zhao, 2022. "The Effect of Flood Risk on Residential Land Prices," Land, MDPI, vol. 11(10), pages 1-18, September.

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    More about this item

    Keywords

    School districting; Residential sorting; Urban inequality; Boundary discontinuity; Hedonic valuation;
    All these keywords.

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General

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