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On the Political Economy of Social Security and Public Education

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  • Panu Poutvaara

    (CEBR)

Abstract

I analyze simultaneous voting on the wage tax rate and investment in public education using a model with three overlapping generations and ability differences inside each cohort. Wage tax revenue finances public education and social security benefits. I derive the results both for a once-and-for-all voting system with commitment and for repeated voting. My model allows demographic change and productivity growth. Even when cohorts are of the same size, the median voter may be a young uneducated citizen.

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File URL: http://128.118.178.162/eps/pe/papers/0303/0303001.pdf
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Bibliographic Info

Paper provided by EconWPA in its series Public Economics with number 0303001.

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Length: 36 pages
Date of creation: 03 Mar 2003
Date of revision:
Handle: RePEc:wpa:wuwppe:0303001

Note: Type of Document - Pdf; prepared on IBM PC; to print on Xerox3N1; pages: 36 ; figures: included. This is a revised version of CESifo Working Paper No. 424 (February 2001) and CEBR Discussion Paper 2002-02.
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Web page: http://128.118.178.162

Related research

Keywords: Social security; Public education; Voting; Implicit intergenerational contract; Structure-induced equilibrium;

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References

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Citations

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Cited by:
  1. Poutvaara, Panu, 2011. "The expansion of higher education and time-consistent taxation," European Journal of Political Economy, Elsevier, vol. 27(2), pages 257-267, June.
  2. Tetsuo Ono, 2011. "Marital Status and Derived Pension Rights: A Political Economy Model of Public Pensions with Borrowing Constraints," Discussion Papers in Economics and Business 11-32-Rev, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP), revised May 2012.
  3. Sita Nataraj Slavov, 2006. "Age Bias in Fiscal Policy: Why Does the Political Process Favor the Elderly?," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 0(1), pages 11.
  4. Mehmet S. Tosun, 2005. "Global Aging and Fiscal Policy with International Labor Mobility: A Political Economy Perspective," IMF Working Papers 05/140, International Monetary Fund.
  5. Michael Kaganovich & Volker Meier, 2008. "Social Security Systems, Human Capital, and Growth in a Small Open Economy," CESifo Working Paper Series 2488, CESifo Group Munich.
  6. Marko Koethenbuerger & Panu Poutvaara & Paola Profeta, 2008. "Why are more redistributive social security systems smaller? A median voter approach," Oxford Economic Papers, Oxford University Press, vol. 60(2), pages 275-292, April.
  7. Bossi, Luca & Gumus, Gulcin, 2011. "Income Inequality, Mobility, and the Welfare State: A Political Economy Model," IZA Discussion Papers 5909, Institute for the Study of Labor (IZA).
  8. Mehmet Serkan Tosun, 2004. "Population Aging, Labor Mobility, and Economic Growth: Evidence From MENA and the Developed World," Working Papers 0417, Economic Research Forum, revised Aug 2004.
  9. Iñigo Iturbe-Ormaetxe & Guadalupe Valera, 2012. "Social security reform and the support for public education," Journal of Population Economics, Springer, vol. 25(2), pages 609-634, January.
  10. Michael Kaganovich & Itzhak Zilcha, 2008. "Alternative Social Security Systems andGrowth," CESifo Working Paper Series 2353, CESifo Group Munich.
  11. Naito, Katsuyuki, 2010. "Two-sided Intergenerational Transfer Policy and Economic Development: A Politico-economic Approach," MPRA Paper 21020, University Library of Munich, Germany.
  12. Alexander Haupt & Silke Uebelmesser, 2009. "Voting on Labour-Market Integration and Education Policy when Citizens Differ in Mobility and Ability," CESifo Working Paper Series 2588, CESifo Group Munich.
  13. Yusuke Kinai, 2011. "Design of a Social Security System: Pension System vs. Unemployment Insurance," Discussion Papers in Economics and Business 11-12, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP).

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