Bequest Taxation, allocation of talents, education and efficiency

Stefano Staffolani and Enzo Valentini

No 248, Working Papers from Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali

Abstract: In this paper we analyze intergenerational mobility on education. After a brief empirical analysis of the influence of family background on educational attainment, we present a dynamic model where the decisions concerning education may be financially constrained. Therefore, people who get higher educational levels are not necessarily the most talented. This "misallocation effect" causes a reduction in the efficiency of the economic system. We show that a proportional bequest taxation, whose yield is redistributed among all "youths", increases efficiency.

Keywords: bequest; education; talent allocation (search for similar items in EconPapers)
JEL-codes: D33 I22 I30 J24 (search for similar items in EconPapers)
Pages: 42
Date: 2006-01
New Economics Papers: this item is included in nep-edu and nep-hrm
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:anc:wpaper:248

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