Education, Rent Seeking and Growth
AbstractThis paper studies the role of education as a way of reducing private rent seeking activities and increasing output. In many underdeveloped economies, for most individuals, there is no private return to education. Nonetheless, according to this paper, governments are better off by investing in public education. We view education as a means to build personal character, thereby affecting macroeconomic long run equilibrium by reducing the number of individuals who are engaged in private rentseeking activities. We show that education is more efficient than ordinary law enforcement because it has a long-run effect. The policy implication of this result is that even when education does not increase human capital, compulsory schooling will be beneficial in pulling underdeveloped economies out of poverty.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 18369.
Date of creation: 31 Oct 2009
Date of revision:
Rent Seeking; Decency; Education; Growth;
Find related papers by JEL classification:
- O10 - Economic Development, Technological Change, and Growth - - Economic Development - - - General
- A20 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - General
- O43 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
- I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-11-07 (All new papers)
- NEP-DEV-2009-11-07 (Development)
- NEP-EDU-2009-11-07 (Education)
- NEP-FDG-2009-11-07 (Financial Development & Growth)
- NEP-HRM-2009-11-07 (Human Capital & Human Resource Management)
- NEP-LAB-2009-11-07 (Labour Economics)
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