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Generational Conflict and Education Politics: Implications for Growth and Welfare

Author

Listed:
  • Yuki Uchida

    () (Faculty of Economics, Seikei University)

  • Tetsuo Ono

    () (Graduate School of Economics, Osaka University)

Abstract

This study considers the politics of public education and its impact on economicgrowth and welfare across generations. We employ probabilistic voting to demon-strate the generational con ict regarding taxes and spending and show that agingresults in a tax burden shift from the retired to the working generation, reductionin public education spending, and ultimately in slowing down economic growth.We subsequently consider a legal constraint that aims to boost education spend-ing: a spending oor for education. This constraint stimulates economic growthbut creates a trade-off between current and future generations' welfare. Finally, thequantitative implications of our results are explored by calibrating the model to theJapanese economy.

Suggested Citation

  • Yuki Uchida & Tetsuo Ono, 2018. "Generational Conflict and Education Politics: Implications for Growth and Welfare," Discussion Papers in Economics and Business 18-05-Rev.2, Osaka University, Graduate School of Economics, revised Apr 2019.
  • Handle: RePEc:osk:wpaper:1805r2
    as

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    References listed on IDEAS

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    More about this item

    Keywords

    Public education; Economic growth; Capital income tax; Proba- bilistic voting;

    JEL classification:

    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education

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