Education, Utilitarianism, and Equality of Opportunity
AbstractWe analyze in this working paper the impact of different policies on the investment of families in the education of their children. In the model we present, families make decisions on the level of human capital of their offspring with a view to the future income that this capital will entail (under the assumption that higher education levels yield higher expected income). Families optimal investment in education depends on their preferences (summarized by their time discount and risk aversion parameters) and their circumstances (initial wealth, parents education, and children s natural abilities). The public authority designs a balanced tax/subsidy scheme in order to maximize aggregate welfare. We compare the case of a purely utilitarian planner with one that cares about the equality of opportunity.
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Bibliographic InfoPaper provided by Fundacion BBVA / BBVA Foundation in its series Working Papers with number 201051.
Date of creation: Oct 2009
Date of revision:
Equality of opportunity; investment in education; public policy design.;
Other versions of this item:
- Calo-Blanco, Aitor & Villar, Antonio, 2009. "Education, Utilitarianism, and Equality of Opportunity," MPRA Paper 18720, University Library of Munich, Germany.
- D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
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