On Human Capital Formation with Exit Options: Comment and New Results
Katz and Rapoport (2005) conclude that with linear production technology and the possibility of unilateral migration, region-specific shocks may increase the average level of education. Previously, Poutvaara (2000) derived a corresponding result with Cobb-Douglas technology and migration which may go in both directions. This paper shows that the exit option may reduce human capital formation with a quadratic production technology.
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- Panu Poutvaara, 2000.
"Education, Mobility of Labour and Tax Competition,"
International Tax and Public Finance,
Springer, vol. 7(6), pages 699-719, December.
- Eliakim Katz & Hillel Rapoport, 2005. "On human capital formation with exit options," Journal of Population Economics, Springer, vol. 18(2), pages 267-274, 06.
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