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Education And Family Income: Can Poor Children Signal Their Talent?

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Author Info
Gonzalo Olcina Vauteren () (Universitat de València)
Luisa Escriche (Universitat de València)
Abstract

The aim of this paper is to explain how financial constraints and family background characteristics affect the signalling educational investments of individuals born in low-income families. We show that talented students who are poor are unable to signal their talent, as the maximum level of education they can attain may also be achieved by less talented students who are rich. Under this approach, a de-crease in inequalities across generations cannot be expected. The paper also shows that an increase in educational standards would help poor individuals with high-ability if it is combined with other non-monetary measures.

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File URL: http://www.ivie.es/downloads/docs/wpasad/wpasad-2006-20.pdf
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File Function: Fisrt version / Primera version, 2006
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Publisher Info
Paper provided by Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie) in its series Working Papers. Serie AD with number 2006-20.

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Length: 46 pages
Date of creation: Oct 2006
Date of revision:
Publication status: Published by Ivie
Handle: RePEc:ivi:wpasad:2006-20

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Related research
Keywords: Market selection hypothesis General Equilibrium with Incomplete markets Wealth accumulation

Find related papers by JEL classification:
I20 - Health, Education, and Welfare - - Education - - - General
C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General

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References listed on IDEAS
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