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Welfare Effects Of Government Intervention In Education

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  • GEORGE PSACHAROPOULOS

Abstract

Distortive effects of government intervention, especially in international trade, have received considerable attention. But not much literature exists on similar effects of public policies toward education. This paper provides a review of government intervention in education and its likely effects on economic growth and equity. Although governments may act with good intentions, educational policies often have adverse effects on social welfare. Less government involvement in education might actually lead to greater and more equally distributed real income, especially in developing countries. Section I of this paper identifies and documents the extent of government‐induced distortions directly or indirectly related to education. Section II assesses the likely effect of such distortions on social welfare. The final section discusses the role of government in education.

Suggested Citation

  • George Psacharopoulos, 1986. "Welfare Effects Of Government Intervention In Education," Contemporary Economic Policy, Western Economic Association International, vol. 4(3), pages 51-62, July.
    • Handle: RePEc:bla:coecpo:v:4:y:1986:i:3:p:51-62
    DOI: 10.1111/j.1465-7287.1986.tb00850.x
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    References listed on IDEAS

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    1. Christopher Dougherty & George Psacharopoulos, 1977. "Measuring the Cost of Misallocation of Investment in Education," Journal of Human Resources, University of Wisconsin Press, vol. 12(4), pages 446-459.
    2. Selowsky, Marcelo, 1981. "Income distribution, basic needs and trade-offs with growth: The case of semi-industrialized Latin American countries," World Development, Elsevier, vol. 9(1), pages 73-92, January.
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    5. Mingat, Alain & Tan, Jee-Peng, 1986. "Expanding education through user charges: What can be achieved in Malawi and other LDCs?," Economics of Education Review, Elsevier, vol. 5(3), pages 273-286, June.
    6. Dougherty, Christopher & Selowsky, Marcelo, 1973. "Measuring the Effects of the Misallocation of Labour," The Review of Economics and Statistics, MIT Press, vol. 55(3), pages 386-390, August.
    7. Jaime A. P. de Melo, 2015. "Distortions In The Factor Market: Some General Equilibrium Estimates," World Scientific Book Chapters, in: Modeling Developing Countries' Policies in General Equilibrium, chapter 15, pages 349-356, World Scientific Publishing Co. Pte. Ltd..
    8. Pinera, Sebastian & Selowsky, Marcelo, 1981. "The optimal ability-education mix and the misallocation of resources within education magnitude for developing countries," Journal of Development Economics, Elsevier, vol. 8(1), pages 111-131, February.
    9. Isbister, John, 1971. "Urban Employment and Wages in a Developing Economy: The Case of Mexico," Economic Development and Cultural Change, University of Chicago Press, vol. 20(1), pages 24-46, October.
    10. Welch, Finis, 1974. "Minimum Wage Legislation in the United States," Economic Inquiry, Western Economic Association International, vol. 12(3), pages 285-318, September.
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    Cited by:

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    2. Élisé Wendlassida Miningou, 2020. "Matching the Education System to the Needs of the Economy: Evidence from Burkina Faso," Cahiers de recherche 20-04, Departement d'économique de l'École de gestion à l'Université de Sherbrooke.

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