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Public investment and higher education inequality


  • Berardino Cesi



Empirical results show that children from high income households achieve higher levels of education and are more likely to be enrolled in post compulsory school. Theoretical findings fail to answer clearly whether greater public investment in the higher education system effectively decreases the inequality between the educational attainment of rich and poor children. We show that if the child receives a monetary transfer from his parents and allocates it between private consumption and investment in private additional education, then a further public investment decreases the educational gap. This result holds under the assumptions of both sub-stitutability and complementarity between private and public education.

Suggested Citation

  • Berardino Cesi, 2006. "Public investment and higher education inequality," Discussion Papers in Economics 06/3, Department of Economics, University of Leicester.
  • Handle: RePEc:lec:leecon:06/3

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    References listed on IDEAS

    1. Fernando Galindo-Rueda & Anna Vignoles, 2005. "The Declining Relative Importance of Ability in Predicting Educational Attainment," Journal of Human Resources, University of Wisconsin Press, vol. 40(2).
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    More about this item


    Higher education inequality; Public education; Altruism;

    JEL classification:

    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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