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Is comprehensive education really free?: a case-study of the effects of secondary school admissions policies on house prices in one local area

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The paper reports on a study that tests the anecdotal hypothesis that parents are willing to pay a premium to secure places for their children in popular and oversubscribed comprehensive schools. Since many local education authorities use admissions policies that are based on catchment areas and places in popular schools are very difficult to obtain from outside these areas—but very easy from within them—parents have an incentive to move house for the sake of their children's education. This would be expected to be reflected in house prices. The study uses a cross-sectional sample based on two popular schools in one local education authority area, Coventry. Differences in quality of housing are dealt with by using the technique of hedonic regression and differences in location by sample selection within a block sample design. The sample was chosen from a limited number of locations spanning different catchment areas to reduce both observable and unobservable variability in nuisance effects while maximizing the variation in catchment areas. The results suggest that there are strong school catchment area effects. For one of the two popular schools we find a 20% premium and for the other a 16% premium on house prices ceteris paribus.
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Keywords: Coventry; Hedonic price functions; House prices; Sample design; Schools

Document Type: Research Article

Affiliations: University of Warwick, Coventry, UK

Publication date: 2003-02-01

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