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The political economy of education and development in an open economy

The political economy of education and development in an open economy
The political economy of education and development in an open economy
If the price effect of opening up a developing economy may be expected to act as a disincentive for investment in human capital, the opposite is likely to be true of the income effect, especially in the presence of credit market imperfections among the poor.
It is shown in this paper that this may no longer be the case in a society initially dominated by an oligarchic capitalist elite that is afraid of losing its political control in favor of an educated middle class.
Although it may sometimes be in its interest to democratize by subsidizing education when the economy is closed, incentives to do so disappear when the economy is open to trade or factor flows.
0965-7576
529
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 (2005) The political economy of education and development in an open economy. Review of International Economics, 13 (3), 529.

Record type: Article

Abstract

If the price effect of opening up a developing economy may be expected to act as a disincentive for investment in human capital, the opposite is likely to be true of the income effect, especially in the presence of credit market imperfections among the poor.
It is shown in this paper that this may no longer be the case in a society initially dominated by an oligarchic capitalist elite that is afraid of losing its political control in favor of an educated middle class.
Although it may sometimes be in its interest to democratize by subsidizing education when the economy is closed, incentives to do so disappear when the economy is open to trade or factor flows.

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Published date: 2005

Identifiers

Local EPrints ID: 39783
URI: https://eprints.soton.ac.uk/id/eprint/39783
ISSN: 0965-7576
PURE UUID: 05ff1f1a-8cab-440c-9675-7f65714b445e

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Date deposited: 29 Jun 2006
Last modified: 15 Nov 2017 08:11

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