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Are the Elderly a Threat to Educational Expenditures?

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  • Alejandra Cattaneo
  • Stefan C. Wolter

Abstract

Empirical research has given cause to fear that the demographic ageing in industrialized countries is likely to exert a negative impact on educational spending. These papers have linked the share of the elderly with the per capita or per pupil spending on education at the local, state-wide or national level, trying to control for other exogenous effects. Although this line of research shows in many cases a negative correlation between the shares of elderly people and educational expenditures, a causal link is difficult to prove. This paper uses a unique and representative survey of Swiss voters of all age groups. The analysis shows that elderly people present a clear tendency to be less willing to spend money on education. They would rather prefer to spend public resources on health and social security than on education. Furthermore the paper shows that much of the negative correlation between the shares of elderly and educational spending is the result of the elderly being politically more conservative and in general less inclined to pay for expenditures in the public sector as a whole.

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File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2007/wp-cesifo-2007-09/cesifo1_wp2089.pdf
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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2089.

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Date of creation: 2007
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Handle: RePEc:ces:ceswps:_2089

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Keywords: public finance; education finance; demographics; survey; Switzerland;

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References

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  1. Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64, pages 416.
  2. Ueli Grob & Stefan C. Wolter, 2005. "Demographic Change and Public Education Spending: A Conflict between Young and Old?," CESifo Working Paper Series 1555, CESifo Group Munich.
  3. Gradstein, Mark & Kaganovich, Michael, 2004. "Aging population and education finance," Journal of Public Economics, Elsevier, vol. 88(12), pages 2469-2485, December.
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  8. Poterba, James M, 1998. "Demographic Change, Intergenerational Linkages, and Public Education," American Economic Review, American Economic Association, vol. 88(2), pages 315-20, May.
  9. Oberndorfer, Ulrich & Steiner, Viktor, 2006. "Intergenerational Conflict, Partisan Politics, and Public Higher Education Spending: Evidence from the German States," IZA Discussion Papers 2417, Institute for the Study of Labor (IZA).
  10. Monika Buetler & Michel André Maréchal, 2007. "Framing Effects in Political Decision Making: Evidence from a Natural Voting Experiment," CESifo Working Paper Series 1940, CESifo Group Munich.
  11. Busemeyer, Marius R. & Goerres, Achim & Weschle, Simon, 2008. "Demands for redistributive policies in an era of demographic aging: The rival pressures from age and class in 15 OECD countries," MPIfG Discussion Paper 08/3, Max Planck Institute for the Study of Societies.
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  13. Harris, Amy Rehder & Evans, William N. & Schwab, Robert M., 2001. "Education spending in an aging America," Journal of Public Economics, Elsevier, vol. 81(3), pages 449-472, September.
  14. Ulrich Oberndorfer & Viktor Steiner, 2007. "Generationen- oder Parteienkonflikt? Eine empirische Analyse der deutschen Hochschulausgaben," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 8(2), pages 165-183, 03.
  15. Michael B. Berkman & Eric Plutzer, 2004. "Gray Peril or Loyal Support? The Effects of the Elderly on Educational Expenditures-super-," Social Science Quarterly, Southwestern Social Science Association, vol. 85(5), pages 1178-1192.
  16. Kemnitz, Alexander, 1999. " Demographic Structure and the Political Economy of Education Subsidies," Public Choice, Springer, vol. 101(3-4), pages 235-49, December.
  17. Ed Baldson & Eric Brunner, 2003. "Intergenerational Conflict and the Political Economy of School Spending," Working papers 2003-24, University of Connecticut, Department of Economics.
  18. Christian A. L. Hilber & Christopher J. Mayer, 2004. "Why Do Households Without Children Support Local Public Schools?," NBER Working Papers 10804, National Bureau of Economic Research, Inc.
  19. Britta Baum & Helmut Seitz, 2003. "Demographischer Wandel und Bildungsausgaben: empirische Evidenz für die westdeutschen Länder," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 72(2), pages 205-219.
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  21. Lars-Erik Borge & Jørn Rattsø, 2008. "Young and Old Competing for Public Welfare Services," CESifo Working Paper Series 2223, CESifo Group Munich.
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Citations

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Cited by:
  1. Anna Montén & Marcel Thum, 2008. "Ageing Municipalities, Gerontocracy and Fiscal Competition," CESifo Working Paper Series 2469, CESifo Group Munich.
  2. Tim Krieger & Jens Ruhose, 2011. "“Honey, I shrunk the kids’ benefits!” — Revisiting intergenerational conflict in OECD countries," Working Papers 46, University of Paderborn, CIE Center for International Economics.
  3. Marius R. Busemeyer & Maria Alejandra Cattaneo & Stefan C. Wolter, 2011. "Individual policy preferences for vocational versus academic education: Microlevel evidence for the case of Switzerland," Economics of Education Working Paper Series 0068, University of Zurich, Institute for Strategy and Business Economics (ISU).
  4. Uschi Backes-Gellner & Johannes Mure, 2008. "The Swiss Leading House on Economics of Education, Firm Behaviour and Training Policies," Economics of Education Working Paper Series 0014, University of Zurich, Institute for Strategy and Business Economics (ISU).
  5. Joern Rattsoe and Rune J Soerensen, 2009. "Grey power and public budgets: Family altruism helps children, but not elderly," Working Paper Series 10009, Department of Economics, Norwegian University of Science and Technology.
  6. Michael Berlemann & Marco Oestmann & Marcel Thum, 2010. "Demographic Change and Bank Profitability. Empirical Evidence from German Savings Banks," CESifo Working Paper Series 2911, CESifo Group Munich.
  7. Rattsø, Jørn & Sørensen, Rune J., 2010. "Grey power and public budgets: Family altruism helps children, but not the elderly," European Journal of Political Economy, Elsevier, vol. 26(2), pages 222-234, June.

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