Work in progress

Even though place-based policies involve large transfers toward low-income neighborhoods, they may also produce territorial stigmatization by spotlighting the targeted areas. This paper appeals to the quasi-experimental discontinuity in a French reform that redrew the zoning map of subsidized neighborhoods on the basis of a sharp poverty cut-off to assess the “net" effect of place-based policies on school outcomes. Using a difference-in-differences approach, we find strong evidence of stigma effects from policy designation on public middle schools located in neighborhoods below the policy cut-off, which saw a significant decrease in their post-reform pupil enrollment compared to their counterfactual analogues in unlabeled areas lying just above the poverty threshold. This "zone-and-shame" effect is immediate, it persists up to five years after the reform, and it is triggered by the reactions of parents from all socioeconomic backgrounds, who avoided public schools in policy areas and shifted to those in other areas or, only for wealthy parents, to private schools. There is also evidence of a short-lived decrease in pupils’ test-scores associated with this spatial resorting. We uncover, on the contrary, only weak evidence of stigma reversion after an area loses its designation, suggesting hysteresis in bad reputations conveyed by policy labeling.

Choosing between vocational or academic education at the end of secondary education has important long-run effects, and is taken at an age where peers’ influence might be paramount. In this paper, we investigate the effect of neighbors’ track choices on 9th graders choices at the end of lower secondary education, in Paris. This question is central to understand the extent to which residential segregation can reinforce social segregation across vocational and academic tracks. We rely on neighbors from the preceding cohort in order to bypass the reflection problem, and use within-catchment-area variation in distance between pairs to account for residential sorting. We use a pair-wise model that enables us to study carefully the role of distance between neighbors, and to perform detailed heterogeneity analysis. Our results suggest that close neighbors do matter in track choices at the end of 9th grade, particularly for pupils pursuing a professional track. This effect is driven by neighbors living in the same building, and is larger for pairs of boys. Our results also suggest that neighbors’ effects tend to accentuate social segregation across high school tracks.