Education Choice, Neoclassical Growth and Class Structure

La Trobe U School of Bus. Discussion Paper No. A01.07

13 Pages Posted: 21 Jan 2002

See all articles by Buly A. Cardak

Buly A. Cardak

La Trobe University - School of Economics

Date Written: December 2001

Abstract

The evolution of income distribution is studied in a dynamic model of education choice. In this model, both public and private education are available. Public education is financed using a tax rate determined by majority voting. The analysis focuses on neoclassical growth in order to ensure tractability in identifying a steady state. The steady state income distribution is found to be bimodal. Public education offers higher growth to the poor in the transition to the steady state, however public education students converge to the lower mode of the income distribution. Under some conditions, universal public education offers steady state human capital superior to that available to any student in the mixed education model considered, while universal private education unconditionally offers steady state human capital superior to that of the mixed education model.

Keywords: Education Choice, Growth, Income Distribution, Public & Private Education

JEL Classification: D31, H20, I22, J24, O40

Suggested Citation

Cardak, Buly, Education Choice, Neoclassical Growth and Class Structure (December 2001). La Trobe U School of Bus. Discussion Paper No. A01.07, Available at SSRN: https://ssrn.com/abstract=297052 or http://dx.doi.org/10.2139/ssrn.297052

Buly Cardak (Contact Author)

La Trobe University - School of Economics ( email )

Bundoora
Bundoora, Victoria 3083 3086
Australia
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