The Paradox of Education or the Good Side of Inequality
AbstractIn this paper, the author argues that one of the mechanisms through which inequality may affect long-run growth is through individuals' education possibilities. The cost of education is, therefore, a crucial variable. The author endogenizes this cost and shows that it will be high relative to average wealth in poor countries and relatively low in rich countries. With two-tailed distributions of wealth, this is going to imply that greater inequality increases growth rates in poor economies, while it decreases them in rich economies. Copyright 1995 by Royal Economic Society.
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Bibliographic InfoArticle provided by Oxford University Press in its journal Oxford Economic Papers.
Volume (Year): 47 (1995)
Issue (Month): 2 (April)
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- Martino, Gaetano & Polinori, Paolo, 2010. "The individual contribution to income inequality: conceptual analysis and empirical investigation," MPRA Paper 34365, University Library of Munich, Germany.
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- Chol-Won Li., . "Inequality and Growth: A Schumpeterian Perspective," Working Papers 9609, Business School - Economics, University of Glasgow, revised Feb 1998.
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