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Income Distribution, Communities and the Quality of Public Education: A Policy Analysis

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Raquel Fernandez
Richard Rogerson

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Abstract

This paper analyzes within the context of a multicommunity model the effects of several policies that affect the financing of public education. The key features of the model are: (I) individuals differ with respect to income, (ii) individuals choose in which community to reside, (iii) communities are characterized by a proportional tax on income and a quality of public education, and (iv) a community's tax rate is chosen by majority vote. We examine three types of policies: subsidies for residency of specific income groups in particular communities, ceilings or floors on community level educational spending, and income redistribution. In each case we examine the consequences of these policies for both welfare and the quality of education across communities. We identify several policies which make all individuals better off and increase the quality of education in all communities.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 4158.

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Date of creation: Sep 1992
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Handle: RePEc:nbr:nberwo:4158

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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.:
  1. Westhoff, Frank, 1977. "Existence of equilibria in economies with a local public good," Journal of Economic Theory, Elsevier, vol. 14(1), pages 84-112, February. [Downloadable!] (restricted)
  2. Durlauf, S.N., 1992. "A Theory of Persistent Income Inequality," Papers 47, Stanford - Institute for Thoretical Economics.
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  3. Epple, Dennis & Filimon, Radu & Romer, Thomas, 1984. "Equilibrium among local jurisdictions: toward an integrated treatment of voting and residential choice," Journal of Public Economics, Elsevier, vol. 24(3), pages 281-308, August. [Downloadable!] (restricted)
  4. Roberts, Kevin W. S., 1977. "Voting over income tax schedules," Journal of Public Economics, Elsevier, vol. 8(3), pages 329-340, December. [Downloadable!] (restricted)
  5. Roland Benabou, 1991. "Workings of a City: Location, Education, and Production," NBER Technical Working Papers 0113, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  6. Card, David & Krueger, Alan B, 1992. "Does School Quality Matter? Returns to Education and the Characteristics of Public Schools in the United States," Journal of Political Economy, University of Chicago Press, vol. 100(1), pages 1-40, February. [Downloadable!] (restricted)
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  7. Rose-Ackerman, Susan, 1979. "Market models of local government: Exit, voting, and the land market," Journal of Urban Economics, Elsevier, vol. 6(3), pages 319-337, July. [Downloadable!] (restricted)
  8. Rubinfeld, Daniel L., 1987. "The economics of the local public sector," Handbook of Public Economics, in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 2, chapter 11, pages 571-645 Elsevier. [Downloadable!] (restricted)
  9. Epple, Dennis & Romer, Thomas, 1991. "Mobility and Redistribution," Journal of Political Economy, University of Chicago Press, vol. 99(4), pages 828-58, August. [Downloadable!] (restricted)
  10. Stiglitz, J. E., 1974. "The demand for education in public and private school systems," Journal of Public Economics, Elsevier, vol. 3(4), pages 349-385, November. [Downloadable!] (restricted)
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(explanations, 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.)

  1. Alejandro Gaviria & Momi Dahan, 1999. "Sibling Correlations and Social Mobility in Latin America," RES Working Papers 4162, Inter-American Development Bank, Research Department. [Downloadable!]
  2. Alejandro Gaviria, 1998. "Intergenerational Mobility, Siblings' Inequality and Borrowing Constraints," University of California at San Diego, Economics Working Paper Series 1998-13, Department of Economics, UC San Diego. [Downloadable!]
    Other versions:
  3. Shelly Lundberg & Richard Startz, 1998. "Inequality and Race: Models and Policy," Discussion Papers in Economics at the University of Washington 0067, Department of Economics at the University of Washington. [Downloadable!]
    Other versions:
  4. Michele Boldrin, 1992. "Public Education and Capital Accumulation," Discussion Papers 1017, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
    Other versions:
  5. Michael Kremer, 1996. "How Much Does Sorting Increase Inequality?," NBER Working Papers 5566, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  6. Roland Benabou, 1996. "Heterogeneity, Stratification, and Growth," NBER Working Papers 4311, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  7. Alejandro Gaviria & Momi Dahan, 1999. "Correlaciones entre hermanos y movilidad social en América Latina," RES Working Papers 4163, Inter-American Development Bank, Research Department. [Downloadable!]
  8. K Blackburn & N Bose, 2001. "A Model of Trickle Down Through Learning," Centre for Growth and Business Cycle Research Discussion Paper Series 06, Economics, The Univeristy of Manchester. [Downloadable!]
  9. Vaitsos, Constantine V., 2003. "Growth Theories Revisited: Enduring Questions with Changing Answers," Discussion Papers 9, United Nations University, Institute for New Technologies. [Downloadable!]
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