capital ; labor supply ; retirement ; training ; dynamic complementarity ; inequality ; returns to education ; (non …

This paper studies how linear tax and education policy should optimally respond to skill-biased technical change (SBTC … effects due to wage-(de)compression, and iii) education distortions. Analytically, the effect of SBTC on these three … distributional losses, and it increases education distortions. Also, SBTC lowers optimal education subsidies, since SBTC generates …

optimal level of education subsidies along with the optimal schedule of the labor income tax. If the government can observe … inputs into the production of human capital, subsidies on education ensure efficiency in human capital accumulation and labor … taxes are more progressive than without education policies. Although the able benefit more than proportionally from …

. If education is complementary to labor effort, education should be subsidized to offset tax distortions on labor supply …. However, if most of the education is enjoyed by high ability households, education should be taxed in order to redistribute … resources to the poor. The paper identifies the exact conditions under which these two effects cancel and education should be …

This paper studies how linear tax and education policy should optimally respond to skill-biased technical change (SBTC … effects due to wage-(de)compression, and iii) education distortions. Analytically, the effect of SBTC on these three … distributional losses, and it increases education distortions. Also, SBTC lowers optimal education subsidies, since SBTC generates …

The standard summary metric of education-based human capital used in macro analyses-the average number of years of …) its virtues of simplicity and transparency make it a good candidate summary measure of education …