  This paper studies the welfare effects of school district consolidation.
Using incomplete rank-ordered lists (ROLs) submitted for admission to the
Hungarian secondary school system, we estimate complete ROLs assuming that
parents do not use dominated strategies and that the matching outcome is
stable. These estimates aid in constructing a counterfactual district-based
assignment and discerning the factors driving parents' preferences over
schools. We find that district consolidation leads to large welfare gains in
Budapest, equivalent to students attending a school five kilometres closer to
their residences. These gains offset the additional travel distances incurred
in the consolidated assignment. 73\% of matched students benefit from district
consolidation, while fewer than 3\% are assigned to a less preferred school.
Students from smaller and less under-demanded districts benefit relatively
more, as well as those with high academic ability. Using reported preferences
instead of estimated ones also yields large gains from district consolidation.
