I would walk 500 miles (if it paid): Vouchers and school choice in Chile

One of the pillars of the educational voucher system is that competition among schools to attract students would improve the quality of the education. Surveys to parents and previous work suggested that families rank the distance of the school from their home as the most important factor for choosing a school. They also suggest that parents largely ignore the results of standardized tests. We use a novel data-set which includes precise measures of the distance between homes and schools to analyze the determinants of school choice in Chile. Economic theory suggests, and the estimations confirm, that parents consider quality and the location when choosing schools. The paper quantifies the relevant trade-offs.