In this article, the joint use of an income tax and public provision of education as instruments to achieve the government’s distributional objectives is considered. Individuals differ in innate labour productivity and in aptitude to acquire skills through education. Actual labour productivity depends on both innate skill and the amount of education received. Using a generalized version of the ...

Academic rankings today are the backbone of research governance, which seem to fit the aims of “new public management” on the one side and the idea of the “republic of science” on the other side. Nevertheless rankings recently came under scrutiny. We discuss advantages and disadvantages of academic rankings, in particular their unintended negative consequences on the research process. To counte...

This paper explores the impact of university finance reforms on teaching quality. It is shown that the graduate tax can achieve efficiency with tuition fees administered by the government, while student grants, pure and income contingent loans can not. However, all options are inefficient when universities have the autonomy to set tuition fees. Then, pure loans dominate the graduate tax and are...

This paper shows that the design of education policy involves a potential conflict between welfare and social mobility. We consider a setting in which social mobility is maximized under the least elitist public education system, whereas welfare maximization calls for the most elitist system. We show that when private education is available, the degree of elitism that maximizes social mobility i...

East Asian students regularly take top positions in international league tables of educational performance. Using internationally comparable student-level data, I estimate how family background and schooling policies affect student performance in five high-performing East Asian economies. Family background is a strong predictor of student performance in South Korea and Singapore, while Hong Kon...

The paper presents a model of educational production which tries to make sense of recent evidence on effects of institutional arrangements on student performance. In a simple principal-agent framework, students choose their learning effort to maximize their net benefits, while the government chooses educational spending to maximize its net benefits. In the jointly determined equilibrium, school...

During the Great Recession, national public school per-pupil spending fell by roughly 7 percent and persisted beyond recovery. The impact of such large sustained education funding cuts is not well understood. To examine this, first, we document that recessionary drop in coincided with end decades-long growth both test scores college-going. Next, show this stalled educational progress was partic...