Saving the American Dream? Education Policies in Spatial General Equilibrium
Children's education and economic opportunities differ substantially across US neighborhoods. This paper develops and estimates a spatial equilibrium model that links children's education outcomes to their childhood location. Two endogeno...
| Main Authors: | , |
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| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2021
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/966501615382476637/Saving-the-American-Dream-Education-Policies-in-Spatial-General-Equilibrium http://hdl.handle.net/10986/35252 |
| Summary: | Children's education and economic
opportunities differ substantially across US neighborhoods.
This paper develops and estimates a spatial equilibrium
model that links children's education outcomes to their
childhood location. Two endogenous factors determine
education choices in each location: local education quality
and local labor market access. This paper estimates the
model with US county-level data and studies the effects of a
school funding equalization on education outcomes and social
mobility. The reform's direct effects improve education
outcomes among children from low-skill families. However,
the effects are weaker in spatial general equilibrium
because average returns to education decline and residential
and educational choices of low-skill families shift them
toward locations with lower education quality. |
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