RACE AND THE STRUCTURE OF SCHOOL DISTRICTS IN THE UNITED-STATES

We believe that tastes for association could play an important role in determining the structure, conduct, and performance of the system of local governments in the United States. Accordingly, we incorporate ra cial discrimination into a model of jurisdiction formation. If one gro up is prejudiced, the model demonstrates that as the population of a r egion becomes more racially heterogenous a greater number of jurisdict ions is required to satisfy their taste for disassociation. Using stat e and metropolitan area panel data, we test this implication of the mo del. We find that, controlling for other relevant variables, increasin g racial heterogeneity of a state population increases the number of s chool districts. We discuss the robustness of our results. We compare the impact of racial heterogeneity on special districts with its impac t on school districts. In sharp contrast to our school district result , we find no evidence that increasing racial heterogeneity affects the formation of special districts. (C) 1997 Academic Press.