{'fraction_non_alphanumeric': 0.022716736207695872, 'fraction_numerical': 0.01205377839592026, 'mean_word_length': 4.896174863387978, 'pattern_counts': {'":': 0, '<': 0, '<?xml version=': 0, '>': 0, 'https://': 0, 'lorem ipsum': 0, 'www.': 0, 'xml': 0}, 'pii_count': 0, 'substrings_counts': 0, 'word_list_counts': {'cursed_substrings.json': 0, 'profanity_word_list.json': 0, 'sexual_word_list.json': 0, 'zh_pornsignals.json': 0}}
Identification and estimation of parental valuation of school quality in the U.S.

In this paper I present new estimates of the value of school quality, derived from differences in rental prices for homes in different school districts, using detailed geographic, household and individual information from the restricted-access 2000 U.S. Decennial Census data. The main contribution of the paper is to develop an approach to identify and estimate how much parents are willing to pay for an improvement in school quality per year, per child and for each grade, from kindergarten to twelfth grade, hence providing to the policy maker a measure that can be directly used to make cost-benefit analysis of investments to improve school quality. The previous literature has not focused on providing a specific unit for the estimate, either per year, per child, or per grade. I build on Berry, Levinsohn and Pakes (1995), Rust (1987) and Heckman and Scheinkman (1987) to extend existing discrete choice models of residential location to address three critical issues. First, I account for differences across families in the value of local school quality by allowing different values for families with children in different grades. Second, I use a dynamic framework to distinguish between the value of school quality services in a given year, and the option value of living in districts with different values of school quality. Third, by combining information on the location choices of families with no children, and those with children of different ages, I control for unobserved neighborhood amenities, including characteristics of the people who live in the neighborhood, that potentially confound the identification of school quality valuation due to sorting. I implement the approach using over 200 school districts in New Jersey. My estimates suggest that parents with a child in high school are willing to pay about 2.7% higher rent per year in order to send that child to a district with 5% higher average test scores. The corresponding valuations are 1.6% for a family with a child in middle school, and 1.4% for a family with a child in elementary school.