Indiana University SPEA Edward J. Bloustein School of Planning and Public Policy University of Pennsylvania AIR American University

Poster Paper: The Effect of Subway Access on School Choice

Saturday, November 14, 2015
Riverfront South/Central (Hyatt Regency Miami)

*Names in bold indicate Presenter

Luis Andres Herskovic and Sebastian Gallegos, University of Chicago
The ultimate goal of school choice is to allow parents to send their children to higher-performing schools. Admission to schools without home-district restrictions should benefit disadvantaged students the most, by expanding their opportunities to leave low performing local institutions. Several studies have shown that distance to school is one of the main determinants of school choice, but challenges to address endogeneity issues remain. Did parents choose where to live and then which school their children would attend, or the opposite? For countries with limited school choice, and admission based on residency - like the U.S.,- this question will stay unanswered. But other setups can still provide informative insights into this fundamental topic. This paper examines school choice in a context where vouchers have been implemented on a large scale, and combines it with a natural experiment that allows us to tackle the endogeneity concern posed above.  In particular, we use information from Santiago, Chile and take advantage of the construction of a new subway line that crosses a large area of the city, previously unconnected to the subway network. We provide convincing evidence showing that the introduction of the subway line was arguably exogenous for families living nearby the new commuting stations.  In this city, schools are highly clustered in certain areas and hence distance becomes especially relevant for students that live in neighborhoods with little connectivity to transport networks. The use of rich administrative data allows us to calculate the distance from student's homes to each school in the city with high accuracy. We are also able to determine which students live inside the area of influence of each new subway station. Using an independent cross sample difference-in-difference estimation, we find that (i) students near the new subway stations travel significantly farther to school than students that live in nearby areas with no subway stations, and (ii) that students near the subway attend schools that have higher scores in standardized tests. Our analysis indicates that parents search for a mix of higher socioeconomic status peers and school value-added, suggesting that school choice is driven by more than just school quality, as measured by test scores or value-added. This set of results is particularly informative for the ongoing school choice debate, reconciling the advocates and skeptics views; school choice may lead to both more stratified and higher quality schools.