Educational Policy: Egalitarian or Elitist?

This paper offers an explanation for observed differences across countries in educational policies and in resulting interpersonal distributions of human capital, analyzing a general-equilibrium model in which, as a result of differences in natural ability and nurturing, some people are initially well-endowed with human capital and some are initially poorly-endowed. It assumes that people can choose to be either producers or predators. Because an increase in a person's human capital makes predation a less attractive choice, it is possible that by using some of their human capital to educate initially poorly-endowed people, well-endowed people can increase their own consumptions. It is predicted that if producers are able to enforce a collective choice that takes advantage of the deterrent effect of allocating resources to guarding against predators, then well-endowed people prefer an egalitarian educational policy that increases the human capital of all poorly-endowed people. Such an educational policy either decreases the cost of deterring predation or makes deterrence possible. In contrast, if producers or small subsets of producers individually choose the amount of their resources to allocate to guarding, taking the ratio of predators to producers as given, then well-endowed people prefer an elitist educational policy that, if it has a redistributional component, decreases the number of poorly-endowed people, thereby decreasing the number of predators, without increasing the human capital of the remaining poorly-endowed people. (Author/SM)