On government-created credit markets for education and endogenous growth
Del Rey, Elena (Universitat de Girona)
López García, Miguel Ángel (Universitat Autònoma de Barcelona. Departament d'Economia Aplicada)

Date:	2020
Description:	10 pàg.
Abstract:	Interest in public loans to fund (higher) education has been increasing in the last decades. This paper explores the general welfare properties of government-created credit markets for education in a three-period overlapping generations model with physical and human capital. It shows that the mere existence of public credit markets is second-best in nature, and cannot decentralize the optimum. Achieving the first-best "Golden Rule" balanced growth path requires a government loan system that lends the amounts required for optimal investments in education and an optimally chosen pure pay-as-you-go social security system. Student loans and pensions thus appear as two inseparable elements of the policy that maximizes social welfare.
Rights:	Aquest document està subjecte a una llicència d'ús Creative Commons. Es permet la reproducció total o parcial, la distribució, i la comunicació pública de l'obra, sempre que no sigui amb finalitats comercials, i sempre que es reconegui l'autoria de l'obra original. No es permet la creació d'obres derivades.
Language:	Anglès
Document:	Article ; recerca ; Versió de l'autor
Subject:	Credit markets for education ; Endogenous growth ; Human capital ; Intergenerational transfers ; Public policy
Published in:	Economic modelling, Vol. 92 (2020) , p. 170-179, ISSN 1873-6122

DOI: 10.1016/j.econmod.2019.12.016

Preprint 31 p, 766.5 KB

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