EconPapers    
Economics at your fingertips  
 

Human Capital Investment and Globalization in Extortionary States

Fredrik Andersson () and Kai Konrad ()

No 239, IZA Discussion Papers from Institute for the Study of Labor (IZA)

Abstract: This paper considers education investment and public education subsidies in closed and open economies with an extortionary government. The extortionary government in a closed economy has incentives to subsidize education in order to overcome a hold-up problem of time consistent taxation, similar to benevolent governments. The two types of government differ in their education policies if highly productive labor is fully mobile. Extortionary governments’ incentives for education subsidies vanish and they even have an incentive to prevent individuals from mobility increasing education investment. Tax competition therefore reduces hold-up problems of time consistent extortionary taxation, but also introduces incentives that reduce workers’ utility.

Keywords: time consistent income taxation; commitment; migration; Globalization; education (search for similar items in EconPapers)
JEL-codes: H21 H23 (search for similar items in EconPapers)
Date: 2001-01
References: Add references at CitEc
Citations View citations in EconPapers (8) Track citations by RSS feed

Published in: Journal of Public Economics, 2003, 87 (7-8), 1539-1555

Downloads: (external link)
http://ftp.iza.org/dp239.pdf (application/pdf)

Related works:
Journal Article: Human capital investment and globalization in extortionary states (2003) Downloads
Working Paper: Human Capital Investment and Globalization in Extortionary States (2002) Downloads
Working Paper: Human capital investment and globalization in extortionary states (2002) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp239

Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany

Access Statistics for this paper

More papers in IZA Discussion Papers from Institute for the Study of Labor (IZA) IZA, P.O. Box 7240, D-53072 Bonn, Germany. Contact information at EDIRC.
Series data maintained by Mark Fallak ().

 
Page updated 2017-11-13
Handle: RePEc:iza:izadps:dp239