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Public Education, Communities, and Vouchers

Maria Luengo-Prado () and Oscar Volij ()

Economic theory and game theory from Oscar Volij

Abstract: This paper examines the effects of school vouchers on public school quality in a simple two-community model with local provision of education. Individuals differ only by income and one community imposes a fixed exogenous costs on its residents. The equilibria of the model are stratified with the rich community providing better education with a lower tax rate. We show that the introduction of a simple voucher system can result in a Pareto improvement as an equilibrium phenomenon. This improvement brings higher education quality to both communities. However, the quality difference between communities is shown to increase in equilibrium.

Keywords: Public education; vouchers; communities. (search for similar items in EconPapers)
JEL-codes: I20 I22 H42 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mic, nep-pbe, nep-pol and nep-pub
Date: 1999-01-19
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Published in Quarterly Review of Economics and Finance, 43, 51-73, (2003).

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Journal Article: Public education, communities and vouchers (2003) Downloads
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