Information Salience as Demand Elasticity Modulator
Observed preference heterogeneity in school choice can reflect either inherent differences in parental values or information processing costs and search frictions faced by disadvantaged families. Disentangling these mechanisms is critical because information frictions can be remedied through targeted policy design.
Picture this
Think of shoppers buying groceries in a store where nutritional content is hidden in fine print versus a store where color-coded health ratings are stamped clearly on the front of every box. Clear ratings allow busy shoppers to quickly identify and select healthier options without spending hours reading ingredient lists.
What the evidence says
Standard choice forms produce wide preference heterogeneity across socioeconomic groups. Delivering direct, simplified test score information to low-income families significantly compresses estimated preference heterogeneity, causing low-SES parents to choose high-performing academic schools at rates comparable to high-SES parents.
- Who
- N = 36,887 human students in Charlotte-Mecklenburg Schools, North Carolina, evaluated alongside randomized experimental information interventions.
- How
- Revealed choice demand modeling linked with randomized field experiments distributing simplified, direct school test score graphics to low-income parents.
What to do
Distribute simplified, high-salience school performance scorecards directly to low-income households during choice enrollment windows to increase quality elasticity.
From the source
"Hastings and Weinstein (2008) find less heterogeneity, with most parents choosing schools with higher test scores, when they receive simplified information on school test scores."
Heterogeneous Preferences and the Efficacy of Public School Choice