Do rural school closures lead to local population decline?

In Denmark, many rural schools have been closed since 2000. These school closures have often resulted in heated debates between local politicians and the local population. Locals have feared that closing their school would have adverse effects and lead to local population decline. Meanwhile, previous research has found mixed evidence on the population effect of rural school closures. The aim of this paper is to contribute to the existing literature by looking at the case of Denmark. The paper analyses the local population effects of the simultaneous closure of eight village schools in 2011 in the same peripheral municipality in Denmark. The case study offers a quasi-experimental setting, and the population effects are estimated through an ordinary and a flexible difference-in-differences (DiD) analysis. Overall, the results show clear evidence of a negative population effect of rural school closures. The ordinary DiD analysis shows a population decline of 7.6 percentage points during the 10-year post-closure period. The flexible DiD analysis points to long-term effects, as the population decline first becomes statistically significant from the sixth year following the closures and onwards. To qualify the results of the econometric tests, we report findings from interviews with local people carried out in 2015 in four of the eight rural communities. Among other things, findings from interviews point to lock-in effects in terms of social capital and housing markets, which helps to understand the dominance of long-term population effects from school closures.