Should education be subsidized for the purpose of redistribution? The usual argument against subsidies to education above the primary level is that the rich take up most education, so a subsidy would increase inequality. We show that there is a counteracting effect: an increase in the stock of...

Should education be subsidized for the purpose of redistribution? The usual argument against subsidies to education above the primary level is that the rich take up most education, so a subsidy would increase inequality. We show that there is a counteracting effect: an increase in the stock of...

Should education be subsidized for the purpose of redistribution? The usual argument against subsidies to education above the primary level is that the rich take up most education, so a subsidy would increase inequality. We show that there is a counteracting effect: an increase in the stock of...

We argue that promoting education may be a means to reduceincome inequality. When workers of different skill levels areimperfect substitutes in production, an increase in the level ofhuman capital in the economy reduces the return to education.Hence, a given compression of after-tax incomes can...

Recent evidence shows that people who grew up in economic hard times more strongly favor government redistribution and are more compassionate towards the poor. We investigate how inclusive this increase in compassion is by studying how macroeconomic conditions experienced during young adulthood...

This paper examines unemployment, wages, and voters' demand for redistribution policy under three different labour market structures: laissez-faire, wage-setting by company or industrial unions, and wage-setting by a central union. Decisions on the level of taxes and benefits are made by...