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A Case for Taxing Education

Author

Listed:
  • Tomer Blumkin
  • Efraim Sadka

Abstract

We illustrate a novel informational feature of education, which the government may utilize. Discretionary decisions of individuals to acquire education may serve as an additional signal (to earned labor income) on the underlying unobserved innate earning ability, thereby mitigating the informational constraint faced by the government. We establish a case for taxing education, as a supplement to the labor income tax.

Suggested Citation

  • Tomer Blumkin & Efraim Sadka, 2005. "A Case for Taxing Education," CESifo Working Paper Series 1440, CESifo.
    • Handle: RePEc:ces:ceswps:_1440
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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp1440.pdf
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    References listed on IDEAS

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    Cited by:

    1. Gonzales-Eiras, Martín & Niepelt, Dirk, 2004. "Sustaining Social Security," Seminar Papers 731, Stockholm University, Institute for International Economic Studies.
    2. Tomer Blumkin & Efraim Sadka, 2008. "A case for taxing education," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 15(2), pages 145-163, April.

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    More about this item

    Keywords

    optimal taxation; re-distribution; education; inequality;
    All these keywords.

    JEL classification:

    • D60 - Microeconomics - - Welfare Economics - - - General
    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General

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