FISCAL COMPETITION AND PUBLIC EDUCATION IN REGIONS

Jorge Durán, Charles Figuieres and Alexandra Rillaers ()
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Alexandra Rillaers: Universidad de Alicante

Working Papers. Serie AD from Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie)

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.

Keywords: Successive generations; Public education; Federal and local government; Fiscal games. (search for similar items in EconPapers)
JEL-codes: E13 I29 O41 (search for similar items in EconPapers)
Pages: 15 pages
Date: 2004-11
New Economics Papers: this item is included in nep-dge, nep-edu, nep-geo, nep-mac, nep-pbe and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:ivi:wpasad:2004-43

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