Arts vs Engineering: The Choice among Consumption of and Investment in Education

Richard Romano and Alessandro Tampieri

Working Papers from Dipartimento Scienze Economiche, Universita' di Bologna

Abstract: In this paper we develop a model in which students choose their university coursework based on both investment and consumption incentives. We show that these education decisions are socially inefficient. This result is driven by the fact that students do not consider an externality in the working environment of acquiring education for investment purposes. We show when and how it is possible to design tuition fees in such a way that students acquire the socially optimal level of education.

JEL-codes: D62 H21 I21 (search for similar items in EconPapers)
Date: 2013-07
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:bol:bodewp:wp892

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