Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/129569
Authors: 
Findeisen, Sebastian
Sachs, Dominik
Year of Publication: 
2014
Series/Report no.: 
Working Paper Series, Department of Economics, University of Mannheim 14-16
Abstract: 
We study the implications of limited commitment on education and tax policies chosen by benevolent governments. Individual wages are determined by both innate abilities and education levels. Consistent with real world practices, the government can decide to subsidize different levels of education at different rates. Deviations from full commitment tend to make education policies more progressive, increasing the education subsidy for initially low skilled agents and decreasing it for initially high skilled agents. We provide suggestive cross-country correlations for this mechanism.
Subjects: 
Education Policies
Time-Inconsistency
Taxation
Inequality
JEL: 
H21
H23
I21
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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