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A Model of Vertically Differenciated Education

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Author Info

  • Effinger, M.R.
  • Polborn, M.K.

Abstract

We analyse the allocation of students who differ in their ability to two school types when there are peer effects (students learn more the better their classmates) and expected income after school depends also on the average productivity of peers. We derive the allocation under free school choice and decentralized determination of the academic level; we show that, compared to the social optimum, the level is suboptimal and to many students attend the better school type. A social planner can improve on the allocation under free school choice by prescribing a higher academic level.

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Bibliographic Info

Paper provided by Toulouse - GREMAQ in its series Papers with number 97.469.

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Length: 15 pages
Date of creation: 1997
Date of revision:
Handle: RePEc:fth:gremaq:97.469

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Web page: http://www-gremaq.univ-tlse1.fr/
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Keywords: EDUCATION ; EXTERNALITIES;

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References

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  1. Milgrom, Paul & Roberts, John, 1994. "Comparing Equilibria," American Economic Review, American Economic Association, vol. 84(3), pages 441-59, June.
  2. 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.
  3. Henderson, Vernon & Mieszkowski, Peter & Sauvageau, Yvon, 1978. "Peer group effects and educational production functions," Journal of Public Economics, Elsevier, vol. 10(1), pages 97-106, August.
  4. Arnott, Richard & Rowse, John, 1987. "Peer group effects and educational attainment," Journal of Public Economics, Elsevier, vol. 32(3), pages 287-305, April.
  5. Laura M. Argys & Daniel I. Rees & Dominic J. Brewer, 1996. "Detracking America's schools: Equity at zero cost?," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 15(4), pages 623-645.
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Cited by:
  1. Volker Meier, 2000. "Choosing Between School Systems," CESifo Working Paper Series 389, CESifo Group Munich.
  2. Hendrik Jürges & Wolfram F. Richter & Kerstin Schneider, 2005. "Teacher quality and incentives - Theoretical and empirical effects of standards on teacher quality," MEA discussion paper series 05091, Munich Center for the Economics of Aging (MEA) at the Max Planck Institute for Social Law and Social Policy.
  3. Volker Meier & Gabriela Schütz, 2007. "The Economics of Tracking and Non-Tracking," Ifo Working Paper Series Ifo Working Papers No. 50, Ifo Institute for Economic Research at the University of Munich.
  4. Hendrik Jürges & Kerstin Schneider & Martin Senkbeil & Claus H. Carstensen, 2009. "Assessment Drives Learning: The Effect of Central Exit Exams on Curricular Knowledge and Mathematical Literacy," CESifo Working Paper Series 2666, CESifo Group Munich.
  5. Kerstin Schneider & Hendrik Jürges, 2008. "Central exit examinations increase performance... but take the fun out of mathematics," Schumpeter Discussion Papers sdp08001, Universitätsbibliothek Wuppertal, University Library.
  6. Uschi Backes-Gellner & Stephan Veen, 2006. "Incentives for Schools, Educational Signals and Labour Market Outcomes," Economics of Education Working Paper Series 0009, University of Zurich, Institute for Strategy and Business Economics (ISU), revised Jun 2006.
  7. Mayer-Foulkes, David, 2002. "On the dynamics of quality student enrollment at institutions of higher education," Economics of Education Review, Elsevier, vol. 21(5), pages 481-489, October.

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