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This study estimates parents’ valuations of small classes by examining the effects of randomly assigned class type on the decision to remove one’s child from the Tennessee Student Teacher Achievement Ratio experiment, using a new hedonic estimation strategy that estimates the cash payment that would be required to generate the same difference in attrition rates as was observed between treatment and control groups. In 2010 dollars, our preferred estimates indicate that parents on the margin of sending their children to private schools valued small classes at $2,000–$18,000 per year relative to a cost of $3,000 per student year.

Estimating Parents’ Valuations of Class Size Reductions Using Attrition in the Tennessee STAR Experiment