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Optimal Educational Choice and Redistribution when Parental Education Matters

Del Rey, Elena; Racionero, Maria


Higher education plays an important role in determining lifetime earnings. In turn, the decision to become educated depends to a large extent on family characteristics, such as wealth and education. In this paper, we focus on the interaction between fiscal policies and educational choices when parental education matters. We derive optimality conditions for a linear income tax and a lump-sum subsidy for education in a dynamic framework in which generations are linked by educational background....[Show more]

CollectionsANU Research Publications
Date published: 2002
Type: Journal article
Source: Oxford Economic Papers


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