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The Expansion of Higher Education and Time-Consistent Taxation

Listed author(s):
  • Poutvaara, Panu

    ()

    (University of Munich)

This paper analyzes educational choices and political support for subsidies to higher education in the presence of a time-consistency problem in income redistribution. There may be political support for so generous subsidization that it motivates the median voter to obtain higher education. As a result of increasing own income, the median voter prefers in the future lower taxes than without higher education. Therefore, the expansion of participation in higher education during the second half of the 20th century may have partly been driven by the aim to limit the political support for overly generous income redistribution.

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File URL: http://ftp.iza.org/dp3023.pdf
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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 3023.

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Length: 15 pages
Date of creation: Sep 2007
Publication status: published in: European Journal of Political Economy, 2011, 27 (2), 257-267
Handle: RePEc:iza:izadps:dp3023
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