The political economy of school choice: Linking theory and evidence

We derive an improved methodology for linking theoretical parameters of a political economy model of school choice to empirical values estimated by regressing local private enrollment shares on mean income, the median-to-mean ratio, religious and ethnic composition, and other variables. This leads us to reject the commonly maintained assumption that a coalition of "ends against the middle" determines local school funding, and to conclude instead that the median-income voter is decisive. It also allows us to estimate the perceived relative efficiency advantage of private schooling, which we find to be about 30% at the margin.