A study identified community-level characteristics associated with the presence or absence of a school. Data from the 1990 Census and the New York Department of Education identified 64 villages in New York with populations of 500 or less, 36 of which had schools, and 233 villages with populations of 501-2,500, 192 of which had schools. Results indicate that for the smallest rural communities, the presence of a school was associated with many social and economic benefits. Housing values were considerably higher in small villages with schools, and municipal infrastructure was more developed. Occupational structure differed qualitatively, in that places with schools had more people employed in more favorable occupational categories and more employment in civic occupations. While average household income was not markedly different across places with and without schools, income inequality and welfare dependence was lower in villages with schools. Although differences between places with and without schools were not as dramatic in larger rural communities, larger rural communities with schools ranked higher than communities without schools on virtually every indicator of social and economic well-being. This study shows that schools serve as important markers of social and economic viability and vitality, and that the money that might be saved through school consolidation could be forfeited in lost taxes, declining property values, and lost business. (Contains 21 references.) (TD)