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Government Spending on Education and Labour Mobility

Published online by Cambridge University Press:  17 August 2016

Jean-Pierre Vidal
Jean-Pierre Vidal*
Affiliation:
GREQAM – Centre National de la Recherche Scientifique**
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Summary

This paper sets up a simple two-country overlapping generations model to explore the interplay between education, taxation, and labour mobility and to assess the impact of education policies on human capital formation and long-run welfare in both the sending and the receiving country. It emphasises the role of diminishing returns with respect to public spending on education in the welfare consequences of labour mobility. Emigration can improve the long-run welfare of the sending country when the elasticity of the education technology is low. Immigration augments the long-run level of human capital in the receiving country but can result in a level of long-run welfare lower than autarky.

Résumé

Résumé

Cet article étudie les conséquences des politiques d’éducation et de taxation sur la mobilité du travail, la formation du capital humain et le bien-être dans un modèle à générations imbriquées à deux pays dans lesquels les technologies d’éducation sont caractérisées par des rendements décroissants par rapport aux dépenses publiques d’éducation. L’émigration amé liore à long terme le bien-être du pays d’origine si Pélasticit é de la technologie d’éducation par rapport aux dépenses publiques d’éducation est suffisamment faible. L’immigration augmente l’accumulation du capital humain à long terme dans le pays d’accueil mais peut conduire à un niveau de bien-être de long terme infél’autarcie.

Keywords

labour migrationeducationF22mobilité du travailcapital humainF22
Type
Research Article
Information
Recherches Économiques de Louvain/ Louvain Economic Review , Volume 66 , Issue 4 , 2000 , pp. 373 - 389
Copyright
Copyright © Université catholique de Louvain, Institut de recherches économiques et sociales 2000 

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Footnotes

*

I want to thank Pascal Belan, Roberto Cardarelli, Bertrand Crettez, Jayasri Dutta, Cecilia Garcia-Penalosa, and two anomymous referees of this review for helpful comments. This research has benefitted from the financial support of the European Commission under Training and Mobility of Researchers' grant #ERBFMB1CT961100. The usual disclaimer applies.

**

2 rue de la Charité, 13002 Marseille, France

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