Assuming that today's school administrator must manage the organizational contraction associated with declining resources, the authors of this research report investigated the causes of contraction and its effects on school systems in terms of demographic changes, economic changes, and political considerations. The researchers examined the policy alternatives of closure, consolidation, and shared use by analyzing the impact of closure on three school sites and of consolidation and shared use on one site each. Six variables relating to the size of the general and student populations within each school's service area were considered for the years 1960-80, using U.S. census and 1974 Polk Profile survey data. The research results showed that school closure as a policy choice had a neutral effect on most variables. When there were immediate impacts, they tended to be negative. However, in one case school closure was related positively to increases in the school-age and younger populations. Shared use was related negatively to most demographic variables. When assessment of the relationship between the intervention and the demographic variables was possible, there tended to be a balance between the neutral and positive trends. Consolidation showed little relationship to changes already in progress. The author concludes that the contraction policy chosen has an impact on neighborhoods where environmental forces converge and resource scarcity increases competition. (Author/PGD)