RALEIGH – A few months ago, Duke University economist Thomas Nechyba came over to the Locke Foundation’s weekly “Shaftesbury Society” meeting at our Raleigh office to talk about his research on school choice. I see that Dr. Nechyba’s studies have now received some additional national exposure, courtesy of the Milton and Rose D. Friedman Foundation (see here), so I thought I’d recapitulate his intriguing argument today.
Most advocates and foes of school vouchers or other tools to promote choice and competition in American schooling tend to dwell on the educational aspects of the debate. To a lesser degree, they discuss implications for taxes and fiscal policy. Nechyba’s contribution to the debate is to probe whether the existence of broader school choices might impact where families choose to live.
Right now, as has often been pointed out, wealthier families already exercise significant choice of schooling. Not only can many afford to send their children to private schools, but also they can afford to move into those neighborhoods from which students are likely to be assigned to the “best” schools in a district. This isn’t a perfect system, of course, and one reason why reassignment is such a bitter political battle is because families have sometimes made significant financial sacrifices in order to be in the “right” assignment zone. Still, school choice does play in role in housing choice, as anyone who has bought a house in recent years can confirm, having heard a lot of real estate agents about nearby schools and their perceived quality.
Moreover, as Nechyba observes, a neighborhood’s school assignment influences the market price of housing available. Places where assignment to a high-performing school is likely tend to reflect that higher demand in the form of higher prices. Necessarily, this means that as a family’s wealth increases, its ability to exercise school choice within the public system increases.
Nechyba argues that in a voucher environment, the link between geographic location and school would be partially or totally severed. Families could opt to attend faraway schools, or nearby private schools, and thus might be less concerned about the perceived quality of the closest public schools. That would, in turn, reduce the premium that families would be willing to pay to live in certain neighborhoods. Some would choose to live in more modestly priced homes, where they can get more house or land for the buck. As prices adjusted accordingly, he suggests, you might well end up with less stratification of the housing market and more integration of neighborhoods, at least by class if not by race.
This is an interesting argument, and a theoretical one. We don’t really know how people would react to a broader education market given that it would still be shaped by a variety of informational challenges. For example, I suspect that many folks, if given more choice, might still be strongly inclined to choose the closest school. You can see this happen in public school districts where open enrollment or its various cousins have been introduced.
Still, a great notion – worth more investigation and consideration by lawmakers who claim to care about the poor and downtrodden.