There goes the neighbourhood

If real estate prices are unaffected, politicians may ask themselves why parents don't think the reforms have improved the school.

Another implication of our findings is that high-quality public education may not be free.

While our results are below the level of private school fees for the typical family, the true cost gap between public and private schooling is smaller than is generally suggested. Not only can poor families not afford access to private schools, they are often also locked out of the best public schools.

Given that education can transform the social and economic opportunities of the underprivileged, this may perpetuate the cycle of intergenerational disadvantage. The possibility of educational exclusion indicates that government funding should be directed towards schools with less talented teachers and substandard facilities to boost the quality of schools in low-income areas.