Reza Moradi

When enrollment falls, a school system has to choose which schools to close, and that choice determines which students bear the cost. I study the distributional effects of a school consolidation program using linked student-teacher and enrollment histories and population data from Puerto Rico, where public enrollment fell by about a third, and the number of operating schools dropped by 44 percent from 2009-10 to 2018-19. I build a framework that separates school contributions to achievement from teacher value added, because teachers move to other schools when a school closes, and uses enrollment before and after closures to estimate substitution across schools. Rural-poor households bore a model-implied accessibility loss to public school per displaced child that was 84 percent larger than for urban non-poor households. Moreover, the change in the estimated effectiveness of the schools rural-poor students attended was 0.09 standard deviations less favorable than that of urban non-poor students. Closing the same number of small schools at random would produce a similar gap in distance. In the counterfactual analysis, holding the number of closures fixed as a stand-in for the budget, closing schools with nearby alternatives reduces the accessibility loss of rural-poor students by 25 percent. However, it removes schools with larger estimated contributions than the schools that remain open nearby. Moreover, reassigning the observed displaced teachers among compatible local receiving posts produces little improvement in rural-poor students’ teacher inputs. These findings show how differences in access to substitutes shape the incidence of consolidation, and the framework can be applied before closures are decided, using records that school systems already keep.