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A Positive Theory of Income Redistribution

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  • Cooper, Suzanne J

Abstract

This article examines how redistribution of human capital expenditure can come about voluntarily. A model is developed in which, in the absence of redistribution, human capital expenditure is financed through tax revenue collected locally. However, circumstances are shown under which transfers of human capital expenditure across neighborhoods can take place voluntarily, even in the absence of interfamily altruism. These transfers can eliminate absolute inequality and reduce relative inequality. In addition, the effect on aggregate income of such human capital funding transfers across neighborhoods is evaluated. Empirical evidence supporting the model's implications for the impact of redistribution of human capital expenditure on the persistence of income inequality is presented Copyright 1998 by Kluwer Academic Publishers

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  • Cooper, Suzanne J, 1998. "A Positive Theory of Income Redistribution," Journal of Economic Growth, Springer, vol. 3(2), pages 171-195, June.
    • Handle: RePEc:kap:jecgro:v:3:y:1998:i:2:p:171-95
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    2. Raquel Fernandez, 2001. "Sorting, Education and Inequality," NBER Working Papers 8101, National Bureau of Economic Research, Inc.
    3. Brotherhood, Luiz & Delalibera, Bruno R., 2020. "Minding the gap between schools and universities," Journal of Economic Dynamics and Control, Elsevier, vol. 120(C).
    4. Raquel Fernández & Richard Rogerson, 2001. "Sorting and Long-Run Inequality," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(4), pages 1305-1341.
    5. Deininger, Klaus & Olinto, Pedro, 2000. "Asset distribution, inequality, and growth," Policy Research Working Paper Series 2375, The World Bank.
    6. Fernández, Raquel, 2001. "Sorting, Education and Inequality," CEPR Discussion Papers 3020, C.E.P.R. Discussion Papers.

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