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Private Schools and the Willingness to Pay for Public Schooling

Author

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  • David M. Brasington

    (Economics Department, Louisiana State University)

Abstract

Households pay a premium to live in houses assigned to high quality public schools, and the housing market yields information about the demand for public school quality. The current study estimates a two-stage house price hedonic emphasizing the role that private schools play in the willingness to pay for public school quality. The elasticity of house prices with respect to public school quality is 0.15, and 0.04 with respect to private school quality. The price elasticity of demand for public schooling is -1.72, with an income elasticity of 0.31. Public and private schools are substitutes, with a cross-price elasticity of 0.32. A school choice program that reduced private school tuition by 10 percent would reduce the willingness to pay for public school performance by 1.9 percent. The magnitude of the results generally varies markedly between large and small houses, with large houses more responsive to public and private schooling variables. © 2007 American Education Finance Association

Suggested Citation

  • David M. Brasington, 2007. "Private Schools and the Willingness to Pay for Public Schooling," Education Finance and Policy, MIT Press, vol. 2(2), pages 152-174, February.
    • Handle: RePEc:tpr:edfpol:v:2:y:2007:i:2:p:152-174
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    File URL: http://www.mitpressjournals.org/doi/pdf/10.1162/edfp.2007.2.2.152
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    Citations

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    Cited by:

    1. Christafore, David & Leguizamon, Susane, 2012. "The influence of gay and lesbian coupled households on house prices in conservative and liberal neighborhoods," Journal of Urban Economics, Elsevier, vol. 71(2), pages 258-267.
    2. James LeSage & Joni Charles, 2008. "Using home buyers’ revealed preferences to define the urban–rural fringe," Journal of Geographical Systems, Springer, vol. 10(1), pages 1-21, March.
    3. Kelley Pace, R. & LeSage, James P., 2008. "A spatial Hausman test," Economics Letters, Elsevier, vol. 101(3), pages 282-284, December.
    4. Xia Feng & Brad R. Humphreys, 2008. "Assessing the Economic Impact of Sports Facilities on Residential Property Values: A Spatial Hedonic Approach," Working Papers 0812, International Association of Sports Economists;North American Association of Sports Economists.
    5. Joshua C. Hall & Donald J. Lacombe & Amir Neto & James Young, 2022. "Bayesian Estimation of the Hierarchical SLX Model with an Application to Housing Markets," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 46(2), pages 360-373, April.
    6. John Yinger, 2009. "Hedonic Markets and Explicit Demands: Bid-Function Envelopes for Public Services, Neighborhood Amenities, and Commuting Costs," Center for Policy Research Working Papers 114, Center for Policy Research, Maxwell School, Syracuse University.
    7. Rasmus Wiese & Steffen Eriksen, 2024. "Willingness to pay for improved public education and public healthcare systems: the role of income mobility prospects," Fiscal Studies, John Wiley & Sons, vol. 45(1), pages 55-76, March.
    8. Yinger, John, 2021. "The price of access to jobs: Bid-function envelopes for commuting costs✰," Journal of Housing Economics, Elsevier, vol. 51(C).
    9. Yinger, John, 2015. "Hedonic markets and sorting equilibria: Bid-function envelopes for public services and neighborhood amenities," Journal of Urban Economics, Elsevier, vol. 86(C), pages 9-25.
    10. Yencha, Christopher, 2019. "Valuing walkability: New evidence from computer vision methods," Transportation Research Part A: Policy and Practice, Elsevier, vol. 130(C), pages 689-709.
    11. Xia Feng & Brad Humphreys, 2018. "Assessing the Economic Impact of Sports Facilities on Residential Property Values," Journal of Sports Economics, , vol. 19(2), pages 188-210, February.

    More about this item

    Keywords

    private schools; public schools; public school quality;
    All these keywords.

    JEL classification:

    • I20 - Health, Education, and Welfare - - Education - - - General
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid

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