Two Essays in Applied Econometrics

Abstract

While the standard hedonic analyses on housing prices attempt to evaluate the impact of school characteristics on house value capitalization, this paper is an attempt to evaluate the same based on increasing open enrollment numbers in better school districts at a district level. It estimates the standard models used in the literature and addresses the issue of bias due to unobserved heterogeneity. This paper also attempts to disentangle the effects of open enrollment by taking a difference model and removing the time invariant unobserved neighborhood characteristics. Also it focuses on houses in the school district boundaries and evaluates the effect at the buffer zones while controlling for other observed characteristics. I find that open enrollment significantly increases housing prices in outer buffer zone at a declining rate and have varying effects in the inner buffer zone and results depend on model specifications. Controlling for most of the possible observed and unobserved characteristics, open enrollment has non-linear effects on housing prices in the inner buffer zone.