Competition in public school districts : charter school entry, student sorting, and school input determination

I develop a model of competition between charter schools and traditional public schools and estimate the model using administrative data from North Carolina. I use the model to quantify how existing charter schools have affected test scores for both charter and public school students and simulate charter school entry and student test scores were binding caps on charters lifted. I find that i) the mean effect of charter schools on attendant students (direct effect ) is 25% of a standard deviation, ii) there is substantial heterogeneity in the mean direct effect by market, iii) the mean spillover effect on public school students is marginal, and iv) lifting caps on charter schools would more than double entry and cause increases in mean test scores similar to those under the capped scenario. -- School choice ; Charter schools ; Education ; Structural estimation ; General equilibrium ; Public economics