Parental Preferences and School Competition: Evidence from a Public School Choice Program

Abstract

This paper uses school choice data from the Charlotte-Mecklenburg School District to study parents' preferences for school characteristics and their implications for demand and competition in school choice.We estimate a mixed-logit demand model using the rankings of parents' top three school choices in the first year of school choice.Our results show that parents value proximity highly and preferences for school test scores increase with student income and own academic ability.We also find considerable heterogeneity in idiosyncratic preferences, with negative correlations between preferences for academics and proximity.Unique aspects of the choice plan, such as the redrawing of school boundaries, allow us to test for bias from endogenous residential location and strategic choices.Simulations of parental responses to school test score improvements suggest that the demand response at high-performing schools would be larger than at low-performing schools, leading to disparate demand-side pressure to improve performance under school choice.

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