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Government Spending on Education and Labour Mobility

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  • Jean-Pierre VIDAL

    (GREQAM-Centre National de la Recherche Scientifique)

Abstract

This paper sets up a simple two-country overlapping generations madel to explore the interplay between education, taxation, and labour mobility and to assess the impact of education policies on human capital formation and long-run welfare in both the sending and the receiving country. It emphasises the role of diminishing returns with respect to public spending on education in the welfare consequences of labour mobility. Emigration can improve the long-run welfare of the sending country when the elasticity of the education technology is low. Immigration augments the long-run level of human capital in the receiving country but can resuit in a level of long-run welfare lower than autarky.

Suggested Citation

  • Jean-Pierre VIDAL, 2000. "Government Spending on Education and Labour Mobility," Discussion Papers (REL - Recherches Economiques de Louvain) 2000041, Universit√© catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  • Handle: RePEc:ctl:louvre:2000041
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    File URL: http://sites.uclouvain.be/econ/DP/REL/2000041.pdf
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    References listed on IDEAS

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    1. George Psacharopoulos, 1985. "Returns to Education: A Further International Update and Implications," Journal of Human Resources, University of Wisconsin Press, vol. 20(4), pages 583-604.
    2. Michel, Ph. & Pestieau, P. & Vidal, J. -P., 1998. "Labor migration and redistribution with alternative assimilation policies: The small economy case," Regional Science and Urban Economics, Elsevier, vol. 28(3), pages 363-377, May.
    3. Bhagwati, Jagdish N. & Hamada, Koichi, 1982. "Tax policy in the presence of emigration," Journal of Public Economics, Elsevier, vol. 18(3), pages 291-317, August.
    4. Mirrlees, J. A., 1982. "Migration and optimal income taxes," Journal of Public Economics, Elsevier, vol. 18(3), pages 319-341, August.
    5. Barro, Robert J, 1990. "Government Spending in a Simple Model of Endogenous Growth," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 103-126, October.
    6. D. Fiaschi, 1996. "Fiscal policies and growth," Working Papers 261, Dipartimento Scienze Economiche, Universita' di Bologna.
    7. Glomm, Gerhard & Ravikumar, B, 1992. "Public versus Private Investment in Human Capital Endogenous Growth and Income Inequality," Journal of Political Economy, University of Chicago Press, vol. 100(4), pages 818-834, August.
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    Cited by:

    1. Belot, M.V.K., 2003. "Labor market institutions in OECD countries : Origins and consequences," Other publications TiSEM d9ec4bc4-0113-4677-a390-d, Tilburg University, School of Economics and Management.

    More about this item

    Keywords

    Labour migration; education;

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration

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