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Dynamic political economy of redistribution policy: the role of education costs

Author

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  • Tetsuo Ono

    (Graduate School of Economics, Osaka University)

  • Ryo Arawatari

    (Graduate School of Economics, Osaka University)

Abstract

This paper focuses on how education costs affect the political determination of redistribution policy via individual decision making on education. For cases of high costs, there are multiple equilibria: the poor-majority equilibrium featured by the minority of highly educated individuals and a high level of redistribution, and the rich-majority equilibrium featured by the majority of highly educated individuals and a low level of redistribution. For cases of low costs, there is a unique rich-majority equilibrium featured by the majority of highly educated individuals and a high level of redistribution.

Suggested Citation

  • Tetsuo Ono & Ryo Arawatari, 2008. "Dynamic political economy of redistribution policy: the role of education costs," Economics Bulletin, AccessEcon, vol. 4(13), pages 1-13.
    • Handle: RePEc:ebl:ecbull:eb-08d70025
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    References listed on IDEAS

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    1. Tetsuo Ono & Ryo Arawatari, 2008. "Dynamic political economy of redistribution policy: the role of education costs," Economics Bulletin, AccessEcon, vol. 4(13), pages 1-13.
    2. Markus Jäntti & Eva Österbacka & Oddbjörn Raaum & Tor Eriksson & Anders Björklund, 2002. "Brother correlations in earnings in Denmark, Finland, Norway and Sweden compared to the United States," Journal of Population Economics, Springer;European Society for Population Economics, vol. 15(4), pages 757-772.
    3. Hassler, John & Storesletten, Kjetil & Zilibotti, Fabrizio, 2007. "Democratic public good provision," Journal of Economic Theory, Elsevier, vol. 133(1), pages 127-151, March.
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    1. repec:ebl:ecbull:v:4:y:2008:i:13:p:1-13 is not listed on IDEAS
    2. Tetsuo Ono & Ryo Arawatari, 2008. "Dynamic political economy of redistribution policy: the role of education costs," Economics Bulletin, AccessEcon, vol. 4(13), pages 1-13.
    3. Arawatari, Ryo & Ono, Tetsuo, 2009. "A second chance at success: A political economy perspective," Journal of Economic Theory, Elsevier, vol. 144(3), pages 1249-1277, May.
    4. Arawatari, Ryo & Ono, Tetsuo, 2013. "Inequality, mobility and redistributive politics," Journal of Economic Theory, Elsevier, vol. 148(1), pages 353-375.

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    More about this item

    JEL classification:

    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • H5 - Public Economics - - National Government Expenditures and Related Policies

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