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Inequality and education choice

Yuki Uchida and Tetsuo Ono ()

MPRA Paper from University Library of Munich, Germany

Abstract: This study presents a two-class successive generations model with human capital accumulation and the choice to opt out of public education. The model demonstrates the mutual interaction between inequality and education choice and shows that this interaction leads to two locally stable steady-state equilibria. The existence of multiple stable equilibria implies a negative association between inequality and public education enrollment, which is consistent with evidence from Organisation for Economic Co-operation and Development (OECD) countries. This study also presents a welfare analysis using data from OECD countries and shows that introducing a compulsory public education system leaves the first generation worse off, although it realizes an equal society and improves welfare for future generations of lower-class individuals.

Keywords: Public education; opting out; inequality (search for similar items in EconPapers)
JEL-codes: D70 H52 I24 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dge
Date: 2019-02-13
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Related works:
Working Paper: Inequality and Education Choice (2017) Downloads
Working Paper: Inequality and Education Choice (2016)
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