Subsidizing or taxing education? A note on the quality gap and government finances

  • Daniel Flores Curiel Universidad Autónoma de Nuevo León
Keywords: education, quality, taxes, subsidies
JEL Classification: H2, I21, I22

Abstract

In this article, I study the effects of an education tax (or subsidy) on the quality gap between public and private education as well as on government finances. In order to do this, I model the behavior of a private school that chooses price and quality in order to compete for students with a public school. Among other things, I show that a per unit tax (or subsidy) can increase (reduce) the quality gap and worsen (improve) government finances.

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Published
01-07-2016
How to Cite
Flores CurielD. (2016). Subsidizing or taxing education? A note on the quality gap and government finances. Estudios Económicos, 31(2), 339-353. https://doi.org/10.24201/ee.v31i2.20
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