Student and Worker Mobility under University and Government Competition
AbstractWe provide a normative analysis of endogenous student and worker mobility in the presence of diverging interests between universities and governments. Student mobility generates a university competition effect which induces them to overinvest in education, whereas worker mobility generates a free-rider effect for governments, who are not willing to subsidize the education of agents who will work abroad. At equilibrium, the free-rider effect always dominates the competition effect, resulting in underinvestment in human capital and overinvestment in research. This inefficiency can be corrected if a transnational transfer for mobile students is implemented. With endogenous income taxation, we show that the strength of fiscal competition increases with human capital production. Consequently, supranational policies aimed at promoting teaching quality reduce tax revenues at the expense of research.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 3415.
Date of creation: 2011
Date of revision:
student mobility; worker mobility; university competition; government competition;
Find related papers by JEL classification:
- H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
- I22 - Health, Education, and Welfare - - Education - - - Educational Finance
- I23 - Health, Education, and Welfare - - Education - - - Higher Education and Research Institutions
- I28 - Health, Education, and Welfare - - Education - - - Government Policy
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Thomas Lange, 2009. "Public Funding of Higher Education when Students and Skilled Workers are Mobile," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 65(2), pages 178-199, June.
- repec:hal:wpaper:halshs-00564912 is not listed on IDEAS
- Gabrielle Demange & Robert Fenge & Silke Uebelmesser, 2008. "Financing Higher Education and Labor Mobility," CESifo Working Paper Series 2362, CESifo Group Munich.
- Lydia Mechtenberg & Roland Strausz, .
"The Bologna Process: How student mobility affects multi-cultural skills and educational quality,"
030, Departmental Working Papers.
- Lydia Mechtenberg & Roland Strausz, 2008. "The Bologna process: how student mobility affects multi-cultural skills and educational quality," International Tax and Public Finance, Springer, vol. 15(2), pages 109-130, April.
- Lydia Mechtenberg & Roland Strausz, 2006. "The Bologna Process: How Student Mobility Affects Multi-Cultural Skills and Educational Quality," SFB 649 Discussion Papers SFB649DP2006-018, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.
- Gabrielle Demange, 2008.
"The Provision of Higher Education in a Global World—Analysis and Policy Implications,"
CESifo Economic Studies,
CESifo, vol. 54(2), pages 248-276, June.
- Demange, Gabrielle & Fenge, Robert & Uebelmesser, Silke, 2008. "The Provision of Higher Education in a Global World - Analysis and Policy Implications," CEPREMAP Working Papers (Docweb) 0806, CEPREMAP.
- Panu Poutvaara, 2004.
CESifo Working Paper Series
1114, CESifo Group Munich.
- Justman, Moshe & Thisse, Jacques-Francois, 1997. "Implications of the mobility of skilled labor for local public funding of higher education," Economics Letters, Elsevier, vol. 55(3), pages 409-412, September.
- repec:pse:psecon:2010-27 is not listed on IDEAS
- Kemnitz, Alexander, 2005.
"Educational Federalism and the Quality Effects of Tuition Fees,"
617, Institut fuer Volkswirtschaftslehre und Statistik, Abteilung fuer Volkswirtschaftslehre.
- Alexander Kemnitz, 2010. "Educational Federalism and the Quality Effects of Tuition Fees," CESifo Working Paper Series 3193, CESifo Group Munich.
- Kemnitz, Alexander, 2007. "Educational Federalism and the Quality Effects of Tuition Fees," Dresden Discussion Paper Series in Economics 08/07, Dresden University of Technology, Faculty of Business and Economics, Department of Economics.
- Gabrielle Demange & Robert Fenge, 2010. "Competition in the quality of higher education: the impact of students' mobility," PSE Working Papers halshs-00564912, HAL.
- Moshe Justman & Jacques-Francois Thisse, 2000. "Local Public Funding of Higher Education When Skilled Labor is Imperfectly Mobile," International Tax and Public Finance, Springer, vol. 7(3), pages 247-258, May.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Julio Saavedra).
If references are entirely missing, you can add them using this form.