What can be (And What has been) Learned from General Equilibrium Simulation Models of School Finance?(Forum: Innovations in Education Policy and Education Research‪)‬

INTRODUCTION An analysis of the choices parents make regarding their children's education is more complex and challenging than the analyses of many other kinds of choices economists typically study. This is true for at least four reasons: First, parental choices regarding their children's education involve judgments about school production functions that economists do not yet understand well. Second, access to primary and secondary public schools is typically linked to residential location--giving rise to trade-offs between schooling, housing quality, and other local amenities. Third, the existence of private schools provides an alternative to a public system that is linked to residential housing markets. And fourth, households face different credit constraints given incomplete credit markets that generally do not permit borrowing against human capital investments.