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Is financial openness bad for education? A political economy perspective

Is financial openness bad for education? A political economy perspective
Is financial openness bad for education? A political economy perspective
This paper presents a simple model of the links between education, democratization and economic development. In a context of imperfect capital markets, we investigate the incentives for a capitalist oligarchy to subsidize the education of poor workers and to initiate a political transition. It is shown that international financial liberalization, while stimulating physical capital accumulation, reduces the capitalist elite willingness to subsidize domestic human capital accumulation in the medium run. It thus delays, without necessarily impeding the process of democratization
democratization, openness, political economy, education
0014-2921
891-903
Bourguignon, François
070fd429-e2bd-4dfb-bd26-80e85c8cb1e0
Verdier, Thierry
87c483ea-f473-408f-9776-d0381cab6454
Bourguignon, François
070fd429-e2bd-4dfb-bd26-80e85c8cb1e0
Verdier, Thierry
87c483ea-f473-408f-9776-d0381cab6454

Bourguignon, François and Verdier, Thierry (2000) Is financial openness bad for education? A political economy perspective. European Economic Review, 44 (4-6), 891-903. (doi:10.1016/S0014-2921(00)00049-0).

Record type: Article

Abstract

This paper presents a simple model of the links between education, democratization and economic development. In a context of imperfect capital markets, we investigate the incentives for a capitalist oligarchy to subsidize the education of poor workers and to initiate a political transition. It is shown that international financial liberalization, while stimulating physical capital accumulation, reduces the capitalist elite willingness to subsidize domestic human capital accumulation in the medium run. It thus delays, without necessarily impeding the process of democratization

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More information

Published date: 2000
Additional Information: JEL classification codes: F2, H1, I2, O1
Keywords: democratization, openness, political economy, education

Identifiers

Local EPrints ID: 33481
URI: https://eprints.soton.ac.uk/id/eprint/33481
ISSN: 0014-2921
PURE UUID: 40d5dfe6-7df7-4ed5-ad99-167a1fb3fd7e

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Date deposited: 19 Jul 2006
Last modified: 15 Jul 2019 19:07

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Contributors

Author: François Bourguignon
Author: Thierry Verdier

University divisions

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