The Role of Institutions on the Nexus between Inequality and Public Education

Kammas, Pantelis and Litina, Anastasia and Palivos, Theodore (2022): The Role of Institutions on the Nexus between Inequality and Public Education.

Abstract

This research revisits and extends the literature on the interplay between inequality and education, by accounting for the role of institutions, the latter being a cornerstone of economies and societies. We establish that in the presence of weak tax institutions, the quality of public education is adversely affected by an increase in income inequality. Moreover, the adverse effect of inequality diminishes as the quality of institutions improves, suggesting that for sufficiently high quality of institutions, an increase in inequality would be less harmful for the quality of education. This effect operates via two channels, namely via an effect on the resources allocated to public education and via an effect on the number of individuals participating in the public schooling system.

• Item Type: MPRA Paper
• Language: English
• Keywords: Quality of Public Education, Income Inequality, Tax Evasion.
• Subjects: D - Microeconomics > D6 - Welfare Economics > D63 - Equity, Justice, Inequality, and Other Normative Criteria and Measurement; H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H26 - Tax Evasion and Avoidance; I - Health, Education, and Welfare > I2 - Education and Research Institutions

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