Journal of Population Economics

, Volume 30, Issue 2, pp 537–567 | Cite as

A normative justification of compulsory education

  • Alessandro Balestrino
  • Lisa Grazzini
  • Annalisa Luporini
Original Paper


Using a household production model of educational choices, we characterise a free-market situation in which some agents (high wagers) fully educate their children and spend a sizable amount of resources on them, while others (low wagers) educate them only partially. The free-market equilibrium is iniquitous, both because the households have different resources and because the children have different access to education. Public policy is thus called for, for vertical as well as horizontal equity purposes. Conventional wisdom has it that both objectives could be achieved using price control instruments, i.e. income taxes and price subsidies. We find instead that income taxes reduce equality of opportunity and that price subsidies cannot remedy this. Quantity controls become necessary: a compulsory education package, financed by a redistributive tax system, achieves both types of equity. Redistributive taxation and compulsory education are therefore best seen as complementary policies.


Education In-kind transfers Redistributive taxation 

JEL Classification

H42 H52 



We are very grateful to two anonymous referees, the editor and Domenico Menicucci for helpful comments. Previous drafts of this paper have been presented at the 2013 SIEP conference (Pavia, Italy), at the 2014 IIPF conference (Lugano, Switzerland) and at the 2014 ASSET conference (Aix-en-Provence, France) as well as at seminars at the University of Paris I and at the University of Pisa. We thank the audiences for the comments, and Elena Del Rey for her insightful discussion.


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Copyright information

© Springer-Verlag Berlin Heidelberg 2016

Authors and Affiliations

  • Alessandro Balestrino
    • 1
  • Lisa Grazzini
    • 2
  • Annalisa Luporini
    • 3
  1. 1.Department of Political ScienceUniversity of Pisa and CESifoPisaItaly
  2. 2.Department of Economics and ManagementUniversity of FlorenceFlorenceItaly
  3. 3.Department of Economics and ManagementUniversity of Florence and CESifoFlorenceItaly

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