Class size and sorting in market equilibrium theory and evidence
This paper examines how schools choose class size and how households sort in response to those choices. Focusing on the highly liberalized Chilean education market, we develop a model in which schools are heterogeneous in an underlying productivity parameter, class size is a component of school qual...
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520 | 3 | |a This paper examines how schools choose class size and how households sort in response to those choices. Focusing on the highly liberalized Chilean education market, we develop a model in which schools are heterogeneous in an underlying productivity parameter, class size is a component of school quality, households are heterogeneous in income and hence willingness to pay for school quality, and schools are subject to a class-size cap. The model offers an explanation for two distinct empirical patterns observed among private schools that accept government vouchers: (i) There is an inverted-U relationship between class size and household income in equilibrium, which will tend to bias cross-sectional estimates of the effect of class size on student performance. (ii) Some schools at the class size cap adjust prices (or enrollments) to avoid adding another classroom, which produces stacking at enrollments that are multiples of the class size cap. This generates discontinuities in the relationship between enrollment and household characteristics at those points, violating the assumptions underlying regression-discontinuity (RD) research designs. This result suggests that caution is warranted in applying the RD approach in settings in which parents have substantial school choice and schools are free to set prices and influence their enrollments. | |
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author | Urquiola Soux, Miguel Verhoogen, Eric |
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This generates discontinuities in the relationship between enrollment and household characteristics at those points, violating the assumptions underlying regression-discontinuity (RD) research designs. 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spelling | Urquiola Soux, Miguel Verfasser (DE-588)12855214X aut Class size and sorting in market equilibrium theory and evidence Miguel Urquiola and Eric Verhoogen Cambridge 2007 1 Online-Ressource txt rdacontent c rdamedia cr rdacarrier NBER Working Paper No. 13303 This paper examines how schools choose class size and how households sort in response to those choices. Focusing on the highly liberalized Chilean education market, we develop a model in which schools are heterogeneous in an underlying productivity parameter, class size is a component of school quality, households are heterogeneous in income and hence willingness to pay for school quality, and schools are subject to a class-size cap. The model offers an explanation for two distinct empirical patterns observed among private schools that accept government vouchers: (i) There is an inverted-U relationship between class size and household income in equilibrium, which will tend to bias cross-sectional estimates of the effect of class size on student performance. (ii) Some schools at the class size cap adjust prices (or enrollments) to avoid adding another classroom, which produces stacking at enrollments that are multiples of the class size cap. This generates discontinuities in the relationship between enrollment and household characteristics at those points, violating the assumptions underlying regression-discontinuity (RD) research designs. This result suggests that caution is warranted in applying the RD approach in settings in which parents have substantial school choice and schools are free to set prices and influence their enrollments. Class size Economic aspects Chile Klassenstärke (DE-588)4073469-9 gnd rswk-swf Schule (DE-588)4053474-1 gnd rswk-swf Schule (DE-588)4053474-1 s Klassenstärke (DE-588)4073469-9 s DE-604 Verhoogen, Eric Verfasser (DE-588)133565262 aut National Bureau of Economic Research Sonstige (DE-588)39157-8 oth http://www.nber.org/papers/w13303.pdf?new_window=1 Volltext |
spellingShingle | Urquiola Soux, Miguel Verhoogen, Eric Class size and sorting in market equilibrium theory and evidence Class size Economic aspects Chile Klassenstärke (DE-588)4073469-9 gnd Schule (DE-588)4053474-1 gnd |
subject_GND | (DE-588)4073469-9 (DE-588)4053474-1 |
title | Class size and sorting in market equilibrium theory and evidence |
title_auth | Class size and sorting in market equilibrium theory and evidence |
title_exact_search | Class size and sorting in market equilibrium theory and evidence |
title_full | Class size and sorting in market equilibrium theory and evidence Miguel Urquiola and Eric Verhoogen |
title_fullStr | Class size and sorting in market equilibrium theory and evidence Miguel Urquiola and Eric Verhoogen |
title_full_unstemmed | Class size and sorting in market equilibrium theory and evidence Miguel Urquiola and Eric Verhoogen |
title_short | Class size and sorting in market equilibrium |
title_sort | class size and sorting in market equilibrium theory and evidence |
title_sub | theory and evidence |
topic | Class size Economic aspects Chile Klassenstärke (DE-588)4073469-9 gnd Schule (DE-588)4053474-1 gnd |
topic_facet | Class size Economic aspects Chile Klassenstärke Schule |
url | http://www.nber.org/papers/w13303.pdf?new_window=1 |
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