Aging population and education finance

Mark Gradstein, Michael Kaganovich

Research output: Contribution to journalArticlepeer-review

66 Scopus citations

Abstract

Conventional wisdom suggests that aging of population will increase political pressure to tilt the composition of social spending in favor of the elderly, while potentially sacrificing other publicly provided goods such as education. This view seems to be supported by recent empirical findings that per child public education spending tends to be lower in US jurisdictions with higher fraction of elderly residents. Do these cross-sectional findings also carry the dynamic implication that longevity will lead over time to waning political support for funding of public education? This paper challenges such implication. We present a model that is consistent with the aforementioned cross-sectional regressions yet predicts an overall positive impact of increasing longevity on public education funding and economic growth.

Original languageEnglish
Pages (from-to)2469-2485
Number of pages17
JournalJournal of Public Economics
Volume88
Issue number9-10
DOIs
StatePublished - 1 Jan 2004

Keywords

  • Local public funding of education
  • Overlapping generations
  • Political equilibrium

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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