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Educational Policy: Egalitarian or Elitist?

  • Herschel I. Grossman
  • Minseong Kim

This paper offers an explanation for observed differences across countries in educational policies and in resulting interpersonal distributions of human capital. We analyse a general equilibrium model in which, as a result of the apportionment of natural ability, nurturing, and publicly financed education, some people can be well endowed with human capital, whereas other people are poorly endowed with human capital. We assume that people can choose to be either producers or predators. Because an increase in a person’s human capital makes predation a less attractive choice for that person, it is possible that by using some of their human capital to educate the poorly endowed people the well endowed people can increase their own consumption. More interestingly, our theory predicts that, if producers are able to enforce a collective choice that takes advantage of the deterrent effect of allocating resources to guarding against predators, then the well endowed people prefer a relatively egalitarian educational policy that increases the human capital of all of the poorly endowed people. Such an educational policy either decreases the cost of deterring predation or makes deterrence possible. In contrast, if producers or small subsets of producers individually choose the amount of their resources to allocate to guarding, taking the ratio of predators to producers as given, then the well endowed people prefer an elitist educational policy that, if it has a redistributional component, decreases the number of poorly endowed people, thereby decreasing the number of predators, without increasing the human capital of the remaining poorly endowed people.These implications seem to be consistent with the facts about differences across countries in educational policy.

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Article provided by Wiley Blackwell in its journal Economics & Politics.

Volume (Year): 15 (2003)
Issue (Month): 3 (November)
Pages: 225-246

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Handle: RePEc:bla:ecopol:v:15:y:2003:i:3:p:225-246
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  1. José De Gregorio & Jong-Wha Lee, 1999. "Education and Income Distribution: New Evidence from Cross-country Data," Documentos de Trabajo 55, Centro de Economía Aplicada, Universidad de Chile.
  2. Grossman, Herschel I., 1995. "Robin hood and the redistribution of property income," European Journal of Political Economy, Elsevier, vol. 11(3), pages 399-410, September.
  3. Herschel I. Grossman & Minseong Kim, 2002. "Predation, Efficiency, and Inequality," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 158(3), pages 393-, September.
  4. Klaus Deininger & Lyn Squire, 1996. "A New Data Set Measuring Income Inequality," CEMA Working Papers 512, China Economics and Management Academy, Central University of Finance and Economics.
  5. Paolo Mauro, 1995. "Corruption and Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 110(3), pages 681-712.
  6. Grossman, Herschel I. & Kim, Minseong, 2000. "Predators, moral decay, and moral revivals," European Journal of Political Economy, Elsevier, vol. 16(2), pages 173-187, June.
  7. Grossman, Herschel I & Kim, Minseong, 1995. "Swords or Plowshares? A Theory of the Security of Claims to Property," Journal of Political Economy, University of Chicago Press, vol. 103(6), pages 1275-88, December.
  8. Dan Usher, 1997. "Education as a Deterrent to Crime," Canadian Journal of Economics, Canadian Economics Association, vol. 30(2), pages 367-84, May.
  9. Usher, D, 1987. "Theft as a Paradigm for Departures from Efficiency," Oxford Economic Papers, Oxford University Press, vol. 39(2), pages 235-52, June.
  10. Hongyi Li & Lyn Squire & Tao Zhang & Heng-fu Zou, 1999. "A Data Set on Income Distribution," CEMA Working Papers 575, China Economics and Management Academy, Central University of Finance and Economics.
  11. Easterly, W & Levine, R, 1996. "Africa's Growth Tragedy : Policies and Ethnic Divisions," Papers 536, Harvard - Institute for International Development.
  12. Raquel Fernandez & Richard Rogerson, 1995. "On the Political Economy of Education Subsidies," Review of Economic Studies, Oxford University Press, vol. 62(2), pages 249-262.
  13. Grossman, Herschel I, 1994. "Production, Appropriation, and Land Reform," American Economic Review, American Economic Association, vol. 84(3), pages 705-12, June.
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