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The effect of charter competition on unionized district revenues and resource allocation

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  • Cook, Jason B.

Abstract

This study examines the impact of competition due to charter school entry on the level of revenues and the composition of expenditures within traditional public school districts (TPSDs). I leverage a policy change affecting the location and timing of charter entry to account for endogenous charter competition. TPSDs respond to competition by allocating resources away from instructional and other expenditures toward new capital construction. Using teacher contracts, I show that collectively bargained salaries are largely unresponsive to competition and that declines in instructional spending are primarily due to decreases in the number of employed teachers. Competition depresses appraised housing valuations, in turn causing TPSDs to lose property tax revenues resulting in a decline in overall spending.

Suggested Citation

  • Cook, Jason B., 2018. "The effect of charter competition on unionized district revenues and resource allocation," Journal of Public Economics, Elsevier, vol. 158(C), pages 48-62.
    • Handle: RePEc:eee:pubeco:v:158:y:2018:i:c:p:48-62
    DOI: 10.1016/j.jpubeco.2017.12.003
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    Cited by:

    1. Sarah R. Cohodes & Elizabeth M. Setren & Christopher R. Walters, 2021. "Can Successful Schools Replicate? Scaling Up Boston's Charter School Sector," American Economic Journal: Economic Policy, American Economic Association, vol. 13(1), pages 138-167, February.
    2. Ridley, Matthew & Terrier, Camille, 2018. "Fiscal and education spillovers from charter school expansion," LSE Research Online Documents on Economics 91700, London School of Economics and Political Science, LSE Library.
    3. Sorensen, Lucy C. & Holt, Stephen B., 2021. "Sorting it Out: The Effects of Charter Expansion on Teacher and Student Composition at Traditional Public Schools," Economics of Education Review, Elsevier, vol. 82(C).
    4. Michael S. Kofoed & Christopher Fawson, 2021. "A neighborly welcome? Charter school entrance and public school competition on the capital margin," Public Choice, Springer, vol. 188(1), pages 75-94, July.
    5. Bo Feng, 2023. "Charter school proliferation and school district fiscal stress, a chicken‐egg problem," Growth and Change, Wiley Blackwell, vol. 54(4), pages 853-869, December.
    6. Christian Buerger, 2020. "The Influence of Finance Policies on Charter School Supply Decisions in Five States," Public Budgeting & Finance, Wiley Blackwell, vol. 40(2), pages 44-74, June.
    7. Helen F. Ladd & John D. Singleton, 2020. "The Fiscal Externalities of Charter Schools: Evidence from North Carolina," Education Finance and Policy, MIT Press, vol. 15(1), pages 191-208, Winter.
    8. Michah W. Rothbart, 2020. "The Impact of School Choice on Public School Budgets: Evidence From Open Enrollment in New York City," Public Budgeting & Finance, Wiley Blackwell, vol. 40(4), pages 3-37, December.
    9. Bruhn, Jesse & Imberman, Scott & Winters, Marcus, 2022. "Regulatory arbitrage in teacher hiring and retention: Evidence from Massachusetts Charter Schools," Journal of Public Economics, Elsevier, vol. 215(C).
    10. Jason B. Cook, 2019. "Government Privatization and Political Participation: The Case of Charter Schools," Working Paper 6651, Department of Economics, University of Pittsburgh.
    11. David J. Deming & Michael Lovenheim & Richard Patterson, 2018. "The Competitive Effects of Online Education," NBER Chapters, in: Productivity in Higher Education, pages 259-290, National Bureau of Economic Research, Inc.

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    More about this item

    Keywords

    Charter competition; Resource allocation; Measurement error; School finance; Teachers' unions;
    All these keywords.

    JEL classification:

    • C18 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Methodolical Issues: General
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J52 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Dispute Resolution: Strikes, Arbitration, and Mediation

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