Teach a Man to Fish? Education vs. Optimal Taxation

Eric Stephens

No 2010-15, Working Papers from University of Alberta, Department of Economics

Abstract: In models of redistribution, diff erences in human capital are often the relevant source of heterogeneity amongst individuals. Presumably, the distribution of human capital can be manipulated through education spending. This paper examines the use of education as a redistributive tool when there is a nonlinear tax system in place. The results show that taxation, whether under full or asymmetric information, substantially reduces the redistributive role of education spending in maximizing social welfare. This points to a conflict between the equalization of utility and human capital outcomes.

Keywords: optimal nonlinear taxation; redistribution; education (search for similar items in EconPapers)
JEL-codes: D63 H21 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2010-08-30, Revised 2012-02-27
New Economics Papers: this item is included in nep-edu, nep-lab and nep-pub
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Related works:
Journal Article: Teach a man to fish? Education vs. optimal taxation (2012)
Journal Article: Teach a man to fish? Education vs. optimal taxation (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:ris:albaec:2010_015

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