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Public Education, Occupational Choice, and the Growth‐Inequality Relationship
Author(s) -
LloydEllis Huw
Publication year - 2000
Publication title -
international economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.658
H-Index - 86
eISSN - 1468-2354
pISSN - 0020-6598
DOI - 10.1111/1468-2354.00060
Subject(s) - inequality , economics , distribution (mathematics) , labour economics , general equilibrium theory , income distribution , demographic economics , public education , wedge (geometry) , economic growth , microeconomics , mathematics , mathematical analysis , geometry
This article develops a dynamic general equilibrium model in which the occupational structure of the economy drives a wedge between the social and private returns to schooling for some workers. I study the impacts of alternative allocations of public resources between basic and higher levels of education on enrollments, income distribution, and growth. In particular, I illustrate how the growth‐inequality relationship depends on the tension between two forces: (1) the “trickle‐down” effects of expenditures on higher education and (2) the positive impacts on secondary enrollments generated by high‐quality basic education and reduced parental inequality.