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Federalism, Education-Related Public Good and Growth when Agents are Heterogeneou

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  • Floriana Cerniglia
  • Riccarda Longaretti

Abstract

In this paper we use an endogeneous-growth model with human capital and heterogeneous agents to analyse the relationship between fiscal federalism and economic growth. Results show that federalism, which allows education-related public good levels to be tailored on the human capital of heterogeneous agents, increases human capital accumulation. This in turn leads to higher rates of growth. The benefits of federalism are stronger the larger the intra-jurisdiction variance of agents’ human capital.

Suggested Citation

  • Floriana Cerniglia & Riccarda Longaretti, 2008. "Federalism, Education-Related Public Good and Growth when Agents are Heterogeneou," Working Papers 138, University of Milano-Bicocca, Department of Economics, revised May 2008.
    • Handle: RePEc:mib:wpaper:138
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    Cited by:

    1. Thushyanthan Baskaran & Lars P. Feld & Jan Schnellenbach, 2016. "Fiscal Federalism, Decentralization, And Economic Growth: A Meta-Analysis," Economic Inquiry, Western Economic Association International, vol. 54(3), pages 1445-1463, July.
    2. Raúl A Ponce-Rodríguez & Charles R Hankla & Jorge Martinez-Vazquez & Eunice Heredia-Ortiz, 2018. "Rethinking the Political Economy of Decentralization: How Elections and Parties Shape the Provision of Local Public Goods," Publius: The Journal of Federalism, CSF Associates Inc., vol. 48(4), pages 523-558.
    3. Hughes Hallett, Andrew & Scott, Drew, 2010. "Scotland: A New Fiscal Settlement," SIRE Discussion Papers 2010-23, Scottish Institute for Research in Economics (SIRE).
    4. Hughes Hallett, Andrew & Scott, Drew, 2010. "Scotland: A New Fiscal Settlement," SIRE Discussion Papers 2010-23, Scottish Institute for Research in Economics (SIRE).
    5. Akira Shimada, 2019. "Should the Government Promote Global Education?," European Research Studies Journal, European Research Studies Journal, vol. 0(2), pages 323-341.
    6. Thushyanthan Baskaran & Lars P. Feld & Jan Schnellenbach, 2014. "Fiscal Federalism, Decentralization and Economic Growth: Survey and Meta-Analysis," CESifo Working Paper Series 4985, CESifo.
    7. Mauro, Luciano & Pigliaru, Francesco & Carmeci, Gaetano, 2018. "Decentralization and growth: Do informal institutions and rule of law matter?," Journal of Policy Modeling, Elsevier, vol. 40(5), pages 873-902.
    8. Yipeng Liu & Hong Guo & Barrie R. Nault, 2017. "Organization of Public Safety Networks: Spillovers, Interoperability, and Participation," Production and Operations Management, Production and Operations Management Society, vol. 26(4), pages 704-723, April.

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    More about this item

    Keywords

    Fiscal Federalism; Endogenous Economic Growth; Overlapping Generations; Heterogeneous Agents;
    All these keywords.

    JEL classification:

    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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