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Stratified or Comprehensive? The Economic Efficiency of School Design

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  • Giorgio Brunello
  • Massimo Giannini

Abstract

We study the efficiency of secondary school design by focusing on the degree of differentiation between vocational and general education. Using a simple model of endogenous job composition, we analyze the interaction between relative demand and relative supply of skills and characterize efficient school design when the government runs schools and cares about total net output. We show that neither a comprehensive nor a stratified system unambiguously dominates the other system in terms of efficiency for all possibile values of the underlying parameters. Since comprehensive systems generate more equal labor market outcomes, it follows that the relationship between efficiency and equity in secondary education is not necessarily a trade off. We also show that net output maximizing government policy is not always supported by majority voting. When schools are stratified, majority voting could increase the elitist nature of general schools by rising the admission standard above efficient levels. At the same time, and depending on the values of the underlying parameters, efficient stratified schools could be voted down in favor of less efficient comprehensive schools.

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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 453.

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Date of creation: 2001
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Handle: RePEc:ces:ceswps:_453

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  1. Bartel, Ann P & Sicherman, Nachum, 1998. "Technological Change and the Skill Acquisition of Young Workers," Journal of Labor Economics, University of Chicago Press, vol. 16(4), pages 718-55, October.
  2. Bertocchi, Graziella & Spagat, Michael, 1998. "The Evolution of Modern Educational Systems: Technical Vs. General Education, Distributional Conflict and Growth," CEPR Discussion Papers 1925, C.E.P.R. Discussion Papers.
  3. Bartel, Ann P & Lichtenberg, Frank R, 1987. "The Comparative Advantage of Educated Workers in Implementing New Technology," The Review of Economics and Statistics, MIT Press, vol. 69(1), pages 1-11, February.
  4. Brunello, Giorgio & Giannini, Massimo, 1999. "Selective Schools," IZA Discussion Papers 76, Institute for the Study of Labor (IZA).
  5. Aghion, Philippe & Caroli, Eve & Garcia-Penalosa, Cecilia, 1999. "Inequality and economic growth: the perspective of the new growth theories," CEPREMAP Working Papers (Couverture Orange) 9908, CEPREMAP.
  6. Dennis Epple & Elizabeth Newlon & Richard Romano, 2000. "Ability Tracking, School Competition, and the Distribution of Educational Benefits," NBER Working Papers 7854, National Bureau of Economic Research, Inc.
  7. Daron Acemoglu, 2000. "Technical Change, Inequality, and the Labor Market," NBER Working Papers 7800, National Bureau of Economic Research, Inc.
  8. Oded Galor & Omer Moav, 1998. "Ability Biased Technological Transition, Wage Inequality, and Economic Growth," Working Papers 98-14, Brown University, Department of Economics.
  9. Francesco Caselli, 1999. "Technological Revolutions," American Economic Review, American Economic Association, vol. 89(1), pages 78-102, March.
  10. Betts, Julian R, 1998. "The Impact of Educational Standards on the Level and Distribution of Earnings," American Economic Review, American Economic Association, vol. 88(1), pages 266-75, March.
  11. Gianni de Fraja, 2002. "The Design of Optimal Education Policies," Review of Economic Studies, Oxford University Press, vol. 69(2), pages 437-466.
  12. De Fraja, Gianni, 1999. "Equal Opportunities in Education: Market Equilibrium and Public Policy," CEPR Discussion Papers 2090, C.E.P.R. Discussion Papers.
  13. Daron Acemoglu, 1998. "Changes in Unemployment and Wage Inequality: An Alternative Theory and Some Evidence," NBER Working Papers 6658, National Bureau of Economic Research, Inc.
  14. Caroline Hoxby, 2000. "Peer Effects in the Classroom: Learning from Gender and Race Variation," NBER Working Papers 7867, National Bureau of Economic Research, Inc.
  15. Gould, Eric D & Moav, Omer & Weinberg, Bruce A, 2001. " Precautionary Demand for Education, Inequality, and Technological Progress," Journal of Economic Growth, Springer, vol. 6(4), pages 285-315, December.
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