Education Policy and Mobility: Some Basic Results

Ulrich Hange ()

No 937, CESifo Working Paper Series from CESifo

Abstract: This paper analyzes regional public education policy in the presence of mobile workers. Labor market integration leads to fiscal competition, shifting the whole burden of taxation to immobile workers. In the case of mobile skilled workers, this results in income inequalities and inefficient low investment in human capital. This is even more pronounced if politicians are partly self-interested. In contrast, if unskilled workers are mobile, all households receive the same net earnings. In this scenario, a benevolent government ensures an efficient level of human capital investment, while partly selfish politicians choose to invest too little in education.

Keywords: education policy; factor mobility (search for similar items in EconPapers)
Date: 2003
New Economics Papers: this item is included in nep-ure
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Citations: View citations in EconPapers (1)

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