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We argue that promoting education may be a means to reduceincome inequality. When workers of different skill levels … areimperfect substitutes in production, an increase in the level ofhuman capital in the economy reduces the return to education … atrade-off between the distortions of taxes on effort and the distortionsof education subsidies on the investment in human …
Persistent link: https://www.econbiz.de/10011333262
We analyze optimal redistribution in the presence of labor market signaling where innate productive ability is not only unobserved by the government, but also by prospective employers. Signaling in both one and two dimensions is considered, where in the latter case firms have an informational...
Persistent link: https://www.econbiz.de/10012599061
of education taxes/subsidies. We demonstrate how the government can achieve redistribution through wage compression and …
Persistent link: https://www.econbiz.de/10012660137
This paper studies optimal taxation of income and education when employers cannot observe workers' productivity and … workers signal their productivity to firms by choosing both quantity and quality of education. We characterize constrained …. Implementation through income and education dependent taxes is discussed, as well as education mandates. A key insight is that …
Persistent link: https://www.econbiz.de/10014490255
We analyze the redistributive (dis)advantages of a minimum wage over income taxation in competitive labor markets. A minimum wage causes more unemployment, but also leads to more skill formation as unemployment is concentrated on low-skilled workers. A simple condition based on three sufficient...
Persistent link: https://www.econbiz.de/10010234542
We analyze optimal redistribution in the presence of labor market signaling where innate productive ability is not only unobserved by the government, but also by prospective employers. Signaling in both one and two dimensions is considered, where in the latter case firms have an informational...
Persistent link: https://www.econbiz.de/10013217555
We study the joint design of nonlinear income and education taxes when the government pursues redistributive objectives … education. Market remuneration of agents depends on both their innate ability type and their educational choices. Our focus is … on income and education and shed light on the reasons for it and mechanisms through which it is done. We show how and why …
Persistent link: https://www.econbiz.de/10013390911
redistributive taxation. Our results show how an optimal mix of education policy, public employment, and support to the unemployed …-best optimum most likely implies overprovision of education relative to a policy rule that balances the direct marginal benefit and …
Persistent link: https://www.econbiz.de/10012694145
Should education be subsidized for the purpose of redistribution? The usual argument against subsidies to education … above the primary level is that the rich take up most education, so a subsidy would increase inequality. We show that there … there is a demand for redistribution, the general equilibrium effects on relative wages might make a subsidy to education an …
Persistent link: https://www.econbiz.de/10011400867
Should education be subsidized for the purpose of redistribution? The usual argument against subsidies to education … above the primary level is that the rich take up most education, so a subsidy would increase inequality. We show that there … there is a demand for redistribution, the general equilibrium effects on relative wages might make a subsidy to education an …
Persistent link: https://www.econbiz.de/10011317437