Efficient Subsidization of Human Capital Accumulation with Overlapping Generations and Endogenous Growth

Konferenzbeitrag

This paper studies second best policies for education, saving, and labour in an OLG model in which endogenous growth results from human capital accumulation. Government expenditures have to be financed by linear instruments so that growth equilibria are inefficient. The inefficiency is exacerbated if selfish individuals externalize the positive effect of education on descendents' productivity. It is shown to be second best to subsidize education even relative to the first best if the elasticity of the human capital investment function is strictly increasing.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Beiträge zur Jahrestagung des Vereins für Socialpolitik 2010: Ökonomie der Familie - Session: Endogenous Growth ; No. C14-V1

Classification and Topics

• Classification: Wirtschaft ; Taxation and Subsidies: Efficiency; Optimal Taxation ; Education: Government Policy ; Human Capital; Skills; Occupational Choice; Labor Productivity
• Subject: OLG model ; endogenous growth ; endogenous labour ; education ; and saving ; intergenerational externalities ; optimal taxation

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Braun, Christoph ; Richter, Wolfram F.
• Event: Veröffentlichung
• (who): Verein für Socialpolitik
• (where): Frankfurt a. M.
• (when): 2010

Further information

• Handle: http://hdl.handle.net/10419/37186
• Last update: 10.03.2025, 11:46 AM CET