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Redistributive taxation vs. education subsidies: Fostering equality and social mobility in an intergenerational model
Helmut Schmidt University, Hamburg, Germany.
2010 (English)In: Economics of Education Review, ISSN 0272-7757, E-ISSN 1873-7382, Vol. 29, no 4, p. 597-605Article in journal (Refereed) Published
Abstract [en]

Redistributive taxation and education subsidies are common policies intended to foster education attendance of poor children. However, this paper shows that in an intergenerational framework, these policies can raise social mobility only for some investment situations but not in general. I also study the impact of both policies on the aggregate skill ratio and inequality. While redistributive taxation can raise social mobility but at the same time never reduces inequality, education subsidies can, under some conditions, achieve both simultaneously. Unfortunately, these conditions necessarily require a population in which the skill ratio is already quite high. 

Place, publisher, year, edition, pages
Elsevier, 2010. Vol. 29, no 4, p. 597-605
Keywords [en]
Education subsidies, Inequality, Intergenerational mobility, Redistributive taxation, education policy, modeling, subsidy system, tax system, welfare provision
National Category
Economics
Identifiers
URN: urn:nbn:se:hj:diva-46459DOI: 10.1016/j.econedurev.2009.12.002ISI: 000279212500010Scopus ID: 2-s2.0-77953021269OAI: oai:DiVA.org:hj-46459DiVA, id: diva2:1357500
Available from: 2019-10-04 Created: 2019-10-04 Last updated: 2019-10-04Bibliographically approved

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