Over the past fifty years, school districts have consolidated in an effort to achieve economies of scale. While the determinants and effects of district mergers on operations have been studied (Gordon and Knight 2006; Duncombe and Yinger 2007; Jones et al 2008), the impact on communities has not. In small towns, schools not only educate, but also provide stable employment and are a cornerstone for community engagement and local identity. In this article, we examine whether district mergers have adverse effects on the community at large. We evaluate the effects of rural school district consolidations on town population size, number of schools, and property values using a propensity score matched difference-in-differences design, leveraging a 2003 Arkansas state law requiring reorganization using an enrollment cutoff. We estimate that the reform led to reductions in population, community schools, and property value assessments.
government consolidation, school districts, difference-in-differences, professionalization, decentralization
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