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A Foundation System and a State System - Private-School Implications on Welfare and Education Expenditure

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  • Kwiatkowski, Andrzej

Abstract

This paper examines the effects of two different education - financing systems: a foundation system and a state system on the level and distribution of resources devoted to education in the presence of private schools. We use political economy approach where households differ in their level of income, and the central tax rate used to nance education is determined by a majority vote. Our analysis focuses on implications of allowing for a private-school option. To evaluate the importance of private schools we develop a computational model and calibrate it using USA data. The results reveal that the private school option is very important quantitatively in terms of welfare, total resources spent on education and equity.

Suggested Citation

  • Kwiatkowski, Andrzej, 2010. "A Foundation System and a State System - Private-School Implications on Welfare and Education Expenditure," SIRE Discussion Papers 2010-82, Scottish Institute for Research in Economics (SIRE).
  • Handle: RePEc:edn:sirdps:213
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    More about this item

    Keywords

    Education finance reform; Private schools;

    JEL classification:

    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods

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