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The expansion of higher education and time-consistent taxation

  • Poutvaara, Panu

This paper analyzes educational choices and political support for subsidies to higher education in the presence of a time consistency problem in income redistribution. There may be political support for so generous subsidization that it motivates the median voter to obtain higher education. Therefore, the expansion of participation in higher education during the second half of the 20th century may have partly been driven by the aim to limit the political support for overly generous income redistribution. The paper concludes by considering the implications of globalization on the future of public financing of higher education.

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Article provided by Elsevier in its journal European Journal of Political Economy.

Volume (Year): 27 (2011)
Issue (Month): 2 (June)
Pages: 257-267

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Handle: RePEc:eee:poleco:v:27:y:2011:i:2:p:257-267
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/505544

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  24. Poutvaara, Panu, 2004. "Educating Europe: Should Public Education be Financed with Graduate Taxes or Income-contingent Loans?," Munich Reprints in Economics 19296, University of Munich, Department of Economics.
  25. Johnson, George E, 1984. "Subsidies for Higher Education," Journal of Labor Economics, University of Chicago Press, vol. 2(3), pages 303-18, July.
  26. Perotti, Roberto, 1996. "Growth, Income Distribution, and Democracy: What the Data Say," Journal of Economic Growth, Springer, vol. 1(2), pages 149-87, June.
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