Subsidizing or taxing education? A note on the quality gap and government finances
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.
Barzel, Y. 1976. An alternative approach to the analysis of taxation, Journal of Political Economy, 84: 1177-1197.
Bovenberg, A.L. and B. Jacobs. 2005. Redistribution and learning subsidies are Siamese twins, Journal of Public Economics, 89: 2005-2035.
Buddin, R.J., J.J. Cordes and S.N. Kirby. 1998. School choice in California: Who chooses private schools, Journal of Urban Economics, 44: 110-134.
Chumacero, R.A., D. Gómez and R.D. Paredes. 2011. I would walk 599 miles (if it paid): Vouchers and school choice in Chile, Economics of Education Review, 30: 1103-1114.
Epple, D. and R.E. Romano. 1998. Competition between private and public schools, vouchers and peer-group effects, American Economic Review, 88: 32-62.
Hoyt, W.H. and K. Lee. 1998. Educational vouchers, welfare effects, and voting, Journal of Public Economics, 69: 211-228.
Krishna, K. 1990. Protection and the product line: Monopoly and product quality, International Economic Review, 31: 87-102.
Lankford, H. and J. Wyckoff. 1992. Primary and secondary school choice among public and religious alternatives, Economics of Education Review, 11: 317-333.
Leffler, K.B. 1982. Ambiguous changes in product quality, American Economic Review, 72: 956-967.
Ladd, H.L. 2002. School vouchers: A critical view, Journal of Economic Perspectives, 16: 3-24.
Murayama, C. 2011. Subsidiar la educación privada, El Universal (15/02/2011).
Nesbit, T. 2007. Excise taxation and product quality: The gasoline market, Economic Issues, 12: 1-14.
Sales, F.J. 2013. Gasto corriente monetario trimestral promedio por hogar y porcentaje de gasto por rubro, En Contexto, 37: 1-9.
Sarmiento, S. 2011. Jaque Mate Colegiaturas, Reforma (15/02/2011).
Secretaría de Educación Pública (SEP). 2014. 2do. Informe de Gobierno, 2013-2014.
Sobel, R.S. and T.A. Garrett. 1997. Taxation and product quality: New evidence from generic cigarettes, Journal of Political Economy, 105: 880-887.
Sonstelie, J. 1979. Public school quality and private school enrollments, National Tax Journal, 32: 343-354.
Sumner, M.T. and R. Ward. 1981. Tax changes and cigarette prices, Journal of Political Economy, 89: 1261-1265.
Stiglitz, J.E. 1974. The demand for education in public and private school systems, Journal of Public Economics, 3: 349-385.
West, E.G. 1985. The real cost of tuition tax credits, Public Choice, 46: 61-70.
- Abstract viewed - 326 times
- PDF downloaded - 70 times
- XML downloaded - 0 times