Redistribution and Education Subsidies are Siamese Twins

A.L. Bovenberg, B. Jacobs

Research output: Working paperDiscussion paperOther research output

279 Downloads (Pure)

Abstract

We develop a model of human capital formation with endogenous labor supply and heterogeneous agents to explore the optimal level of education subsidies along with the optimal progressive schedule of the labor income tax and optimal capital income taxes.Subsidies on education ensure efficiency in human capital accumulation, while taxes on skilled labor help to redistribute income towards the less able.We thus provide a rationale for the widely observed presence of education subsidies.The actually observed tax codes and level of education subsidies suggest that a large part of education subsidies can be justified on these grounds.
Original languageEnglish
Place of PublicationTilburg
PublisherMacroeconomics
Number of pages50
Volume2001-82
Publication statusPublished - 2001

Publication series

NameCentER Discussion Paper
Volume2001-82

Fingerprint

Education subsidies
Redistribution
Tax
Human capital formation
Rationale
Skilled labor
Endogenous labor supply
Education
Income
Heterogeneous agents
Subsidies
Human capital accumulation
Labor income
Capital income tax
Income tax
Schedule

Keywords

  • redistribution
  • education
  • subsidies
  • human capital
  • taxation
  • income tax

Cite this

Bovenberg, A. L., & Jacobs, B. (2001). Redistribution and Education Subsidies are Siamese Twins. (CentER Discussion Paper; Vol. 2001-82). Tilburg: Macroeconomics.
Bovenberg, A.L. ; Jacobs, B. / Redistribution and Education Subsidies are Siamese Twins. Tilburg : Macroeconomics, 2001. (CentER Discussion Paper).
@techreport{1309589ea7d24ad6ab7b1d42e16c80d9,
title = "Redistribution and Education Subsidies are Siamese Twins",
abstract = "We develop a model of human capital formation with endogenous labor supply and heterogeneous agents to explore the optimal level of education subsidies along with the optimal progressive schedule of the labor income tax and optimal capital income taxes.Subsidies on education ensure efficiency in human capital accumulation, while taxes on skilled labor help to redistribute income towards the less able.We thus provide a rationale for the widely observed presence of education subsidies.The actually observed tax codes and level of education subsidies suggest that a large part of education subsidies can be justified on these grounds.",
keywords = "redistribution, education, subsidies, human capital, taxation, income tax",
author = "A.L. Bovenberg and B. Jacobs",
note = "Pagination: 50",
year = "2001",
language = "English",
volume = "2001-82",
series = "CentER Discussion Paper",
publisher = "Macroeconomics",
type = "WorkingPaper",
institution = "Macroeconomics",

}

Bovenberg, AL & Jacobs, B 2001 'Redistribution and Education Subsidies are Siamese Twins' CentER Discussion Paper, vol. 2001-82, Macroeconomics, Tilburg.

Redistribution and Education Subsidies are Siamese Twins. / Bovenberg, A.L.; Jacobs, B.

Tilburg : Macroeconomics, 2001. (CentER Discussion Paper; Vol. 2001-82).

Research output: Working paperDiscussion paperOther research output

TY - UNPB

T1 - Redistribution and Education Subsidies are Siamese Twins

AU - Bovenberg, A.L.

AU - Jacobs, B.

N1 - Pagination: 50

PY - 2001

Y1 - 2001

N2 - We develop a model of human capital formation with endogenous labor supply and heterogeneous agents to explore the optimal level of education subsidies along with the optimal progressive schedule of the labor income tax and optimal capital income taxes.Subsidies on education ensure efficiency in human capital accumulation, while taxes on skilled labor help to redistribute income towards the less able.We thus provide a rationale for the widely observed presence of education subsidies.The actually observed tax codes and level of education subsidies suggest that a large part of education subsidies can be justified on these grounds.

AB - We develop a model of human capital formation with endogenous labor supply and heterogeneous agents to explore the optimal level of education subsidies along with the optimal progressive schedule of the labor income tax and optimal capital income taxes.Subsidies on education ensure efficiency in human capital accumulation, while taxes on skilled labor help to redistribute income towards the less able.We thus provide a rationale for the widely observed presence of education subsidies.The actually observed tax codes and level of education subsidies suggest that a large part of education subsidies can be justified on these grounds.

KW - redistribution

KW - education

KW - subsidies

KW - human capital

KW - taxation

KW - income tax

M3 - Discussion paper

VL - 2001-82

T3 - CentER Discussion Paper

BT - Redistribution and Education Subsidies are Siamese Twins

PB - Macroeconomics

CY - Tilburg

ER -

Bovenberg AL, Jacobs B. Redistribution and Education Subsidies are Siamese Twins. Tilburg: Macroeconomics. 2001. (CentER Discussion Paper).