Abstract

http://ssrn.com/abstract=1824175
 


 



Student and Worker Mobility Under University and Government Competition


Matthieu Delpierre


Catholic University of Louvain (UCL) - ECRU

Bertrand Verheyden


affiliation not provided to SSRN

April 27, 2011

CESifo Working Paper Series No. 3415

Abstract:     
We provide a normative analysis of endogenous student and worker mobility in the presence of diverging interests between universities and governments. Student mobility generates a university competition effect which induces them to overinvest in education, whereas worker mobility generates a free-rider effect for governments, who are not willing to subsidize the education of agents who will work abroad. At equilibrium, the free-rider effect always dominates the competition effect, resulting in underinvestment in human capital and overinvestment in research. This inefficiency can be corrected if a transnational transfer for mobile students is implemented. With endogenous income taxation, we show that the strength of fiscal competition increases with human capital production. Consequently, supranational policies aimed at promoting teaching quality reduce tax revenues at the expense of research.

Number of Pages in PDF File: 22

Keywords: student mobility, worker mobility, university competition, government competition

JEL Classification: H770, I220, I230, I280

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Date posted: April 27, 2011  

Suggested Citation

Delpierre, Matthieu and Verheyden, Bertrand, Student and Worker Mobility Under University and Government Competition (April 27, 2011). CESifo Working Paper Series No. 3415. Available at SSRN: http://ssrn.com/abstract=1824175

Contact Information

Matthieu Delpierre
Catholic University of Louvain (UCL) - ECRU ( email )
Belgium
Bertrand Verheyden (Contact Author)
affiliation not provided to SSRN ( email )
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