A new report by the Fiscal Research Center at Georgia State University seeks to quantify how much families were willing to pay for a greater likelihood of receiving access to a charter school between the years 2004 and 2013.
Author Carlianne Patrick examines thirteen metro Atlanta start-up and conversion charter schools that have priority admission zones within their designated attendance zones. Each school has three “priority zones.” The rules governing when a priority zone comes into play and how it interacts with the lottery are quite complex, but the idea is basically this: You get a higher chance of getting into a particular charter school if you reside in priority zone one.
Patrick limits the analysis to home sales within close proximity of the border between priority-one and priority-two attendance zones because they represent a change in admission probability. She claims that residences close to the border—in this case, less than half a mile—should be similar in both observable and unobservable ways, including access to jobs and amenities, styles of houses, foreclosures in the area, etc.
Patrick measures the effect of being on the priority-one side of the border between zones one and two. She also controls for transaction date, which helps with housing value fluctuations over time and limits the sample to “arm’s-length,” single-family residential transactions.
Her key finding is that households are willing to pay a 7–13 percent premium to live in zone one instead of zone two.
The analysis, however, has some flaws. For starters, the sample is very small, and important information is missing. Patrick says nothing about the quality of the schools, the relative difference in the probability of gaining admission between zones one and two, or how familiar parents are with the rules surrounding the zones. She also provides little information on which schools have had to make use of the zone preference and how often they may have done so. Unfortunately, there is no methods appendix to hunt for these answers.
In the end, more evidence is needed to be confident that the zone comparison takes care of other possible unobservable variables. But this is a creative analysis and a cool way to measure how the public may value charter schools. Here’s hoping Caroline Patrick dives deeper in a follow-up study.
SOURCE: Carlianne Patrick, "Willing to Pay: Charter Schools’ Impact on Georgia Property Values," Fiscal Research Center, Georgia State University (August 2015).
