Abstract
Most people don’t think of the educational system as working a transfer of income partly because there is not all that much income in it. Nevertheless, when we think of wealth, human capital is one of the more important parts of the wealth of any modern nation. The bulk of this human capital is acquired after we leave the educational system as a result of participation in various economic activities, and our human capital, to a large extent, is knowledge of those activities. But although this is true, the start of accumulating human capital in the educational system is very important. This is particularly true with the higher educational systems, but it is also true to some extent in the lower schools.
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For simplicity, I assume there is no tax on retired persons to support education. This, of course, is not true of the United States. Child allowances used in some countries tend to distribute this expenditure over a lifetime, also.
Note that I am talking about government support of elementary education and not the particular organizational structure. What I have to say is relatively indifferent to the question of whether there is direct governmental provision of services or whether the government hires private persons by the way of the voucher system to provide education.
I still retain an open mind on this subject. The statistical evidence does not prove the existence of such externalities, but, in my opinion, it also does not disprove them.
This was the original source of support for almost the entire school system.
For example, see the survey, “Attitudes Torward Year-Round School in Prince William County, Virginia,” Ned Hubbell and Associates, Port Huron, Michigan, 1972.
Nevertheless, the people who own real estate normally do not want to abolish the school system, and here, again, I think there probably are both charitable and externality reasons involved.
Farms raise a special problem, but it should be pointed out that taxes on agricultural land change very slowly and only partially are transmitted to the renter at all.
Edwin G. West, Economics, Education, and the Politician (London: Institute of Economic Affairs, 1968).
Edwin G. West, “The Political Economy of American Public School Legislation,” Journal of Law and Economics (October 1967): 101–128.
Matthew 6:20.
College graduates are, of course, more apt to be leaders in the local community than people who have not been to college, but it is very hard to argue that somebody who has graduated from an engineering, medical, or business school has acquired by that education any particular special capacities to lead the country in the right direction.
Not all of whom by any means are poor. Indeed, one of the things Reagan was criticized for was changing this program so it was available only to the lower two-thirds of the population.
See Wilson Schmidt, “The Economics of Charity: Loans vs. Grants,” J.P.I. 72 (August 1964): 387–395.
The Internal Revenue Service is very generous in its approval policy and only occasionally rejects a “potential charity” either on the grounds that they believe it is fraudulent or very rarely on the grounds that they disapprove of whatever it is that the charity proposes to fund.
This may be changed. It is a very unwise tax because it tends to freeze people in their investments. It could be altered so that switching from one investment to the other is not subject to tax and the tax falls only when you decide to consume the profit. The American economic system would work much better under this tax law change, and statistics indicate there would actually be more money for the government.
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© 1997 Springer Science+Business Media New York
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Tullock, G. (1997). Education and Charity. In: Economics of Income Redistribution. Studies in Public Choice, vol 11. Springer, Dordrecht. https://doi.org/10.1007/978-94-011-5378-2_10
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DOI: https://doi.org/10.1007/978-94-011-5378-2_10
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