publication . Preprint . 2008

Federalism, Education-Related Public Good and Growth when Agents are Heterogeneou

Floriana Cerniglia; Riccarda Longaretti;
Open Access
  • Published: 01 May 2008
Abstract
In this paper we use an endogeneous-growth model with human capital and heterogeneous agents to analyse the relationship between fiscal federalism and economic growth. Results show that federalism, which allows education-related public good levels to be tailored on the human capital of heterogeneous agents, increases human capital accumulation. This in turn leads to higher rates of growth. The benefits of federalism are stronger the larger the intra-jurisdiction variance of agents’ human capital.
Subjects
free text keywords: Fiscal Federalism, Endogenous Economic Growth, Overlapping Generations, Heterogeneous Agents, jel:H77, jel:J24, jel:O41
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