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Fiscal Competition And Public Education In Regions

Author

Listed:
  • Jorge Durán

    () (Universidad de Alicante)

  • Charles Figuieres

    () (INRA)

  • Alexandra Rillaers

    () (Universidad de Alicante)

Abstract

We explore an economy with two regions and independent local administrations. Local governments collect taxes to finance public education, but once educated agents can choose to migrate to the other region. The Nash equilibrium of the long-run game between the two governments is compared to a golden rule-type social optimum. Preliminary results show that the Nash equilibrium will result in over- or under-investment depending on the extent to which public education is subject to congestion.

Suggested Citation

  • Jorge Durán & Charles Figuieres & Alexandra Rillaers, 2004. "Fiscal Competition And Public Education In Regions," Working Papers. Serie AD 2004-43, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
  • Handle: RePEc:ivi:wpasad:2004-43
    as

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    File URL: http://www.ivie.es/downloads/docs/wpasad/wpasad-2004-43.pdf
    File Function: Fisrt version / Primera version, 2004
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    References listed on IDEAS

    as
    1. Robin W. Boadway & Frank R. Flatters, 1982. "Efficiency and Equalization Payments in a Federal System of Government: A Synthesis and Extension of Recent Results," Canadian Journal of Economics, Canadian Economics Association, vol. 15(4), pages 613-633, November.
    2. Mansoorian, Arman & Myers, Gordon M., 1993. "Attachment to home and efficient purchases of population in a fiscal externality economy," Journal of Public Economics, Elsevier, vol. 52(1), pages 117-132, August.
    3. Myers, Gordon M., 1990. "Optimality, free mobility, and the regional authority in a federation," Journal of Public Economics, Elsevier, pages 107-121.
    4. Starrett, David A, 1980. "On the Method of Taxation and the Provision of Local Public Goods," American Economic Review, American Economic Association, vol. 70(3), pages 380-392, June.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Successive generations; Public education; Federal and local government; Fiscal games.;

    JEL classification:

    • E13 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Neoclassical
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • I29 - Health, Education, and Welfare - - Education - - - Other

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