Education Policy and Mobility: Some Basic Results
This paper analyzes regional public education policy in the presence of mobile workers. Labor market integration leads to fiscal competition, shifting the whole burden of taxation to immobile workers. In the case of mobile skilled workers, this results in income inequalities and inefficient low investment in human capital. This is even more pronounced if politicians are partly self-interested. In contrast, if unskilled workers are mobile, all households receive the same net earnings. In this scenario, a benevolent government ensures an efficient level of human capital investment, while partly selfish politicians choose to invest too little in education.
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- Wolfram F. Richter & Kerstin Schneider, 2001.
"Taxing Mobile Capital with Labor Market Imperfections,"
CESifo Working Paper Series
477, CESifo Group Munich.
- Wolfram Richter & Kerstin Schneider, 2001. "Taxing Mobile Capital with Labor Market Imperfections," International Tax and Public Finance, Springer, vol. 8(3), pages 245-262, May.
- Clemens Fuest & Bernd Huber, .
"Tax Coordination and Unemployment,"
EPRU Working Paper Series
97-26, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.
- Wellisch, Dietmar & Wildasin, David E., 1996. "Decentralized income redistribution and immigration," European Economic Review, Elsevier, vol. 40(1), pages 187-217, January.
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