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Investments into Education - Doing as the Parents Did

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  • Georg Kirchsteiger
  • Alexander Sebald

Abstract

Empirical evidence suggests that parents with higher levels of education generally attach a higher importance to the education of their children. This implies an intergenerational chain transmitting the attitude towards the formation of human capital from one generation to the next. We incorporate this intergenerational chain into an OLG-model with endogenous human capital formation. In absence of any state intervention such an economy might be characterized by multiple steady states with low or high human capital levels. There are also steady states where the population is permanently divided into different groups with differing human capital and welfare levels. Compulsory schooling is needed to overcome steady states with low human capital and welfare levels. Tax financed education subsidies can lead to further pareto-improvements.
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  • Georg Kirchsteiger & Alexander Sebald, 2010. "Investments into Education - Doing as the Parents Did," ULB Institutional Repository 2013/149588, ULB -- Universite Libre de Bruxelles.
    • Handle: RePEc:ulb:ulbeco:2013/149588
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    Cited by:

    1. Elvana Hana & Arsena Gjipali, 2010. "What Determines Upper Secondary School Participation? - Intergenerational Effects Of Education Outcomes In Albania," Journal Articles, Center For Economic Analyses, pages 17-31, June.
    2. Bethencourt Carlos & Kunze Lars, 2019. "Like Father, Like Son: Inheriting and Bequeathing," German Economic Review, De Gruyter, vol. 20(2), pages 194-216, May.
    3. Holger Strulik, 2013. "School Attendance And Child Labor—A Model Of Collective Behavior," Journal of the European Economic Association, European Economic Association, vol. 11(2), pages 246-277, April.
    4. Yoko Mimura, 2014. "Family Characteristics and Educational Expenditures in Japan and the United States," Japanese Economy, Taylor & Francis Journals, vol. 40(1), pages 5-28.
    5. Bonein, Aurélie & Serra, Daniel, 2007. "Another experimental look at reciprocal behavior: indirect reciprocity," MPRA Paper 3257, University Library of Munich, Germany, revised Mar 2007.
    6. Corbu Luminița-Claudia, 2020. "Erasmus+ programs-the need to create a competitive space of the Romanian education system," Proceedings of the International Conference on Business Excellence, Sciendo, vol. 14(1), pages 1071-1082, July.
    7. repec:zbw:rwirep:0318 is not listed on IDEAS
    8. Kirchsteiger, Georg & Sebald, Alexander, 2010. "Investments into education--Doing as the parents did," European Economic Review, Elsevier, vol. 54(4), pages 501-516, May.
    9. J. Ignacio Gimenez-Nadal & José Alberto Molina & Yu Zhu, 2018. "Intergenerational mobility of housework time in the United Kingdom," Review of Economics of the Household, Springer, vol. 16(4), pages 911-937, December.
    10. Lars Kunze, 2012. "Like Father, Like Son: Inheriting and Bequeathing," Ruhr Economic Papers 0318, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    11. Chih Ming Tan & Xiao Wang & Xiaobo Zhang, 2024. "It's all in the stars: The Chinese zodiac and the effects of parental investments on offspring's cognitive and noncognitive skill development," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 32(3), pages 877-920, July.
    12. Debora Di Gioacchino & Laura Sabani & Stefano Usai, 2022. "Intergenerational Upward (Im)mobility and Political Support of Public Education Spending," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 8(1), pages 49-76, March.

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    More about this item

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • I2 - Health, Education, and Welfare - - Education

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