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House prices and school choice: Evidence from Chicago's magnet schools’ proximity lottery
Author(s) -
BonillaMejía Leonardo,
Lopez Esteban,
McMillen Daniel
Publication year - 2020
Publication title -
journal of regional science
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.171
H-Index - 79
eISSN - 1467-9787
pISSN - 0022-4146
DOI - 10.1111/jors.12447
Subject(s) - lottery , decree , demographic economics , quality (philosophy) , mile , economics , business , political science , geography , law , microeconomics , philosophy , geodesy , epistemology
Abstract Studies of open school policies predict house prices to rise in areas that gain access to high‐quality schools. However, excess demand may limit access to high‐quality schools. We take advantage of changes in Chicago's schools’ admissions policies to test whether a higher probability of admission to magnet schools for students living within 1.5 miles leads to higher house prices. Results indicate that the 1997 and 2009 reforms increased house prices for homes within the 1.5 mile radius by about 4% and 12.6%, respectively. The higher probability of admission for black students after a consent decree was vacated in 2009 led to a significant increase in prices in predominantly African‐American areas on the south side.