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Inter-Ethnic Redistribution and Human Capital Investments

Author

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  • Leonid V. Azarnert

    () (Bar Ilan University)

Abstract

This article analyzes income redistribution in the inter-ethnic context. The model shows that redistribution in favor of less prosperous ethnic minorities raises fertility among the unskilled minority recipients, lowers fertility among the contributing local skilled, slows human capital accumulation, and reduces the per-capita output growth. The analysis also demonstrates that income redistribution, although financed by taxes levied on the skilled, generates a mechanism that, via its disincentive effect on human capital investment, works strongly against another weak segment of society – the local unskilled. This may provide a purely economic explanation for antipathy toward minorities, especially, among less educated.

Suggested Citation

  • Leonid V. Azarnert, 2009. "Inter-Ethnic Redistribution and Human Capital Investments," Working Papers 2009-01, Bar-Ilan University, Department of Economics.
  • Handle: RePEc:biu:wpaper:2009-01
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    File URL: http://www.biu.ac.il/soc/ec/wp/2009-01/2009-01.pdf
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    Citations

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    Cited by:

    1. Leonid Azarnert, 2010. "Juvenile imprisonment and human capital investment," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 8(1), pages 23-33, March.
    2. Leonid Azarnert, 2010. "Après nous le Déluge: fertility and the intensity of struggle against immigration," Journal of Population Economics, Springer;European Society for Population Economics, vol. 23(4), pages 1339-1349, September.

    More about this item

    Keywords

    redistribution; ethnic diversity; fertility; human capital; economic growth;

    JEL classification:

    • D3 - Microeconomics - - Distribution
    • J1 - Labor and Demographic Economics - - Demographic Economics
    • O0 - Economic Development, Innovation, Technological Change, and Growth - - General

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