Democratic Choice of an Education System: Implications for Growth and Income Distribution
We use an OLG model to examine democratic choice between two modes of government support for education: subsidies for privately purchased education and free uniform public provision. We find little conflict between democracy and growth: the same factors that generate popular support for subsidization over free uniform provision--large external benefits, a large excess burden, and little inequality--also favor its relative growth performance. Furthermore, restricting the franchise to an upper- income elite may also reduce growth. Two extensions examine the effect of intergenerational mobility and indicate the theoretical possibility of periodic swings in the balance between public and private spending. Copyright 1997 by Kluwer Academic Publishers
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- Saint-Paul, Gilles & Verdier, Thierry, 1993.
"Education, democracy and growth,"
Journal of Development Economics,
Elsevier, vol. 42(2), pages 399-407, December.
- Oded Galor & Joseph Zeira, 1993. "Income Distribution and Macroeconomics," Review of Economic Studies, Oxford University Press, vol. 60(1), pages 35-52.
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"The Distribution of Human Capital and Economic Growth,"
18-96, Tel Aviv - the Sackler Institute of Economic Studies.
- Galor, Oded & Tsiddon, Daniel, 1997. " The Distribution of Human Capital and Economic Growth," Journal of Economic Growth, Springer, vol. 2(1), pages 93-124, March.
- Epple, Dennis & Romano, Richard E, 1996. "Public Provision of Private Goods," Journal of Political Economy, University of Chicago Press, vol. 104(1), pages 57-84, February.
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