Local Public Funding of Higher Education When Skilled Labor is Imperfectly Mobile
AbstractIf higher education is publicly funded by local (sub-federal) jurisdictions, while skilled labor is heterogeneous in responding to wage differentials between jurisdictions, the spillovers that result give rise to a disparity between the centralized output-maximizing allocation of resources to higher education and decentralized equilibria. Generally, decentralization leads to under-provision, which can be offset by inter-jurisdictional subsidies based on gross migration flows. But the extent of the discrepancy depends on the local balance of political forces. Indeed, when the welfare of native-born emigrants is highly valued while new immigrants carry little political weight, over-provision in equilibrium is possible. Copyright Kluwer Academic Publishers 2000
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Bibliographic InfoArticle provided by Springer in its journal International Tax and Public Finance.
Volume (Year): 7 (2000)
Issue (Month): 3 (May)
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Web page: http://www.springerlink.com/link.asp?id=102915
education; labor mobility; local public finance; fiscal federalism;
Other versions of this item:
- JUSTMAN , Moshe & THISSE, Jacques-François, . "Local public funding of higher education when skilled labor is imperfectly mobile," CORE Discussion Papers RP -1460, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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