On Tuesday, I was reading the Rosen Report, a widely-read and highly-respected financial markets newsletter where Eric Rosen collects an eclectic set of interesting topics, and I was thrilled to see that Eric highlighted a conversation around charter schools in NYC.  As a professor of finance and real estate but also a school choice advocate, I am gratified to see increased interest from the business community in how school choice impacts economic development in communities. 

The article highlighted in his newsletter was a piece on how NYC charter schools are outperforming public schools and doing it at less than half the cost per student. However, quality outcomes and cost efficiency aren’t the only positive aspects of the charter system in NYC. 

Real estate research shows that previous NYC charter school expansion increased housing demand in the neighborhoods with new charter schools, leading to higher residential property values and economic growth. Here’s a quick summary of the piece:

• NYC charter schools climbed from 14 charter schools in 2001 to 183 in 2013, an average increase of 0.96 charter schools per zip code.

• Adding one new charter school in a zip code increased residential property prices there by 3.69%.

• Researchers projected that the expansion of charter schools in NYC added as much as $22.45 billion to NYC residential property values.

The principle that school choice prompts economic expansion has been studied outside of NYC as well. Here’s the key idea: 

School choice attracts and retains middle-class families (with children) to relocate to nearby neighborhoods, even though the families are not required to move closer to the school to attend. A charter school can be a greater relocation attractor for families than workplaces are for parents.  This attraction facilitates a thriving economy in the community. 

(Read my research on this in the Journal of Real Estate Economics.)

A Miami-Dade County School Choice History: 

Recently, I attended a dinner in Palm Beach where John Kirtley, Step Up for Students founder and chairman, noted that Miami-Dade County has the most robust school-choice education market in the nation. He shared that in Dade County, ¾ of the students in the area attend school somewhere other than their assigned school.

Following up on these numbers, Kirtley pointed me to an excellent piece by Ron Matus where he shared further data on how Dade County became the most “vibrant education market” in the state with the most “vibrant education market.”

Education Market Impacts the Broader Community:

But don’t just look at the education market.  As Miami-Dade’s school choice environment evolved, the county’s economy has boomed. The migration of high-income people to Miami is certainly a big part of that boom, but Miami’s ability to attract and retain middle-income families is also an important part of the area’s economic vibrancy.

Dade isn’t the only Florida county attracting families. It’s probably no coincidence that the state with the most vibrant education market is now the fastest growing state in the country.  

An economy will become significantly less dynamic if its schools drive out middle-class families. Where education is concerned, what happens in Florida shouldn’t have to stay in Florida. Curious about this concept? Take a look around our website.