Gerhard Glomm | Indiana University (original) (raw)

Papers by Gerhard Glomm

Research paper thumbnail of Why poor countries rely mostly on redistribution in-kind

Journal of Public Economics, 2000

We present a model in which the crucial distinction between rich and poor countries is that gover... more We present a model in which the crucial distinction between rich and poor countries is that governments in rich countries have access to a more productive tax collection technology than governments in poor countries. Since the tax collection technology in poor countries is poor, the quality of the public service is low. Therefore many households at the top of the income distribution opt out of the public service. The median voter takes this into consideration and allocates a larger share of the public budget to redistribution in-kind (public service) than to redistribution in cash.

Research paper thumbnail of Composition of Government Budget, Non-Single Peakedness, and Majority Voting

Journal of Public Economic Theory, 2001

In this paper we study whether majority voting equilibria exist when preferences over public poli... more In this paper we study whether majority voting equilibria exist when preferences over public policies are not single peaked. The government levies a proportional income tax. Tax revenue is used to finance a uniform lump-sum transfer and public education. Individuals vote on the composition of the government budget. We show that the single-crossing property cannot be invoked to establish existence of a majority voting equilibrium. In a simple parametric example we find that cycles are pervasive.

Research paper thumbnail of Opting Out of Publicly Provided Service: A Majority Voting Result

Research paper thumbnail of Public education and income inequality

European Journal of Political Economy, 2003

This paper examines the evolution of inequality in an overlapping generations model where each in... more This paper examines the evolution of inequality in an overlapping generations model where each individual's human capital investment depends on quality of schools. We consider an education regime where the quality of schools is a publicly provided input financed by an income tax. We show that the income gap between the rich and the poor may widen even when the quality of public education is the same across all individuals. Thus, in the short run, public education may not be the great equalizer as intended by its proponents, though it is in the long run. We also show that the effect of taxes on inequality is ambiguous. D

Research paper thumbnail of Public investment in infrastructure in a simple growth model

Journal of Economic Dynamics & Control, 1994

In this paper, we examine the implications for capital accumulation when infrastructure enters as... more In this paper, we examine the implications for capital accumulation when infrastructure enters as an external input into private production functions. In our model, infrastructure is nonexclusive but may exhibit varying degrees of nonrivalry. Revenues from uniform taxes on capital ...

Research paper thumbnail of Whatever happened to the Kuznets curve? Is it really upside down

Journal of Income Distribution, 1997

Kuznets (1955) embarked on a research program whose goal was to find the determinants of the long... more Kuznets (1955) embarked on a research program whose goal was to find the determinants of the long run levels and trends in income inequality and the relationship between income inequality and economic growth. Recently a small body of theoretical work has developed which tries to obtain the inverted U hypothesis as an equilibrium outcome in dynamic general equilibrium model. One

Research paper thumbnail of Flat-Rate Taxes, Government Spending on Education, and Growth

Review of Economic Dynamics, 1998

We address three questions in this paper. First, what is the impact on growth of changes in flat-... more We address three questions in this paper. First, what is the impact on growth of changes in flat-rate taxes when government spending on education affects private decisions to accumulate human capital? Second, are the growth effects negligible when we ...

Research paper thumbnail of Endogenous public policy and multiple equilibria

European Journal of Political Economy, 1996

One of the well known roles of public policy in models with indeterminacy is to reduce the set of... more One of the well known roles of public policy in models with indeterminacy is to reduce the set of equilibria. However, agents' expectations regarding future policy may be self fulfilling when public policy is endogenized. We show that a simple overlapping generations economy with public education may yield multiple equilibria. Under a laissez-faire system, our model has a unique equilibrium.

Research paper thumbnail of Opting out of publicly provided services: A majority voting result

Social Choice and Welfare, 1998

Our objective in this paper is to examine majority voting in an environment where both public and... more Our objective in this paper is to examine majority voting in an environment where both public and private alternatives coexist. We construct a model in which households are differentiated by income and have the option of choosing between publicly provided services and private services. Publicly provided services are financed through income tax revenues and made available to all citizens at zero price. Majority voting determines the tax rate. Even though preferences over tax rates are not single peaked, we provide conditions under which a majority voting equilibrium exists. We illustrate our existence result with CES preferences and a Dagum income distribution.

Research paper thumbnail of On the political economy of means-tested education vouchers

European Economic Review, 2000

We use computational experiments to study the impact of means-tested education vouchers on the le... more We use computational experiments to study the impact of means-tested education vouchers on the level and distribution of educational expenditures. Our benchmark is a regime where public and private schools coexist. Our means-tested voucher regime is one where households with lower incomes receive a larger voucher. Both the level of funding and the allocation of vouchers by income are endogenously determined by sequential majority voting. We examine the e!ect on educational expenditures of switching from a mixed public/private education regime to a means-tested voucher regime or to a uniform voucher regime where all households receive the same voucher. We "nd that: (i) Under means-tested vouchers, public funding for education is the smallest but average educational expenditure is the largest; (ii) inequality of educational resources is smaller under means-tested than that under uniform vouchers or the mixed regime; (iii) the &poor' and the &rich' households prefer means testing to either the mixed or uniform regime.

Research paper thumbnail of Opting our of Publically Provided Services: A M ajority Voting Result

Research paper thumbnail of Human capital accumulation and endogenous public expenditures

Canadian Journal of Economics-revue Canadienne D Economique, 2001

In this paper, we present an overlapping-generations model, where individuals accumulate human ca... more In this paper, we present an overlapping-generations model, where individuals accumulate human capital through formal schooling. We model the role of the public sector in schooling as one of collecting taxes from households and providing inputs to the learning technology. Public expenditures on schools are determined endogenously. Under plausible restrictions, our model's predictions qualitatively match the observations on schooling, public expenditures on education, and student-teacher ratios. JEL Classification: E13, E62.

Research paper thumbnail of Productive government expenditures and long-run growth

Journal of Economic Dynamics & Control, 1997

... National Tax Journal, 121134. Jones, LE and R. Manuelli, 1990, A convex model of equilibrium ... more ... National Tax Journal, 121134. Jones, LE and R. Manuelli, 1990, A convex model of equilibrium growth. ... 204 G. Glomm, B. Ravikumar Journal of Economic Dynamics and Control 21 (1997) 183204 Kocherlakota, N. and KM Yi, 1994a, Is there endogenous long run growth? ...

Research paper thumbnail of Increasing returns, human capital, and the Kuznets curve

Journal of Development Economics, 1998

We present a simple model of human capital accumulation which generates the Kuznets curve as an e... more We present a simple model of human capital accumulation which generates the Kuznets curve as an equilibrium outcome. The central ingredient that helps generate the Kuznets curve in the model is what we call short-run increasing returns to scale in the learning technology. The learning technology exhibits increasing returns to scale, but only in the short run, since one of the factors of production, time, is bounded above by the endowment. We show that short-run increasing returns to scale is necessary to obtain the Kuznets curve, but not sufficient.

Research paper thumbnail of Public versus Private Investment in Human Capital Endogenous Growth and Income Inequality

Journal of Political Economy, 1992

... for part b is similar since equation (9) has the same implications as (7). But note that even... more ... for part b is similar since equation (9) has the same implications as (7). But note that even if -y + 8 < 1, income inequality in the ... of human capital tomorrow is not only a function of his private stock today but also a function of the average human capital stock of society today. ...

Research paper thumbnail of Why poor countries rely mostly on redistribution in-kind

Journal of Public Economics, 2000

We present a model in which the crucial distinction between rich and poor countries is that gover... more We present a model in which the crucial distinction between rich and poor countries is that governments in rich countries have access to a more productive tax collection technology than governments in poor countries. Since the tax collection technology in poor countries is poor, the quality of the public service is low. Therefore many households at the top of the income distribution opt out of the public service. The median voter takes this into consideration and allocates a larger share of the public budget to redistribution in-kind (public service) than to redistribution in cash.

Research paper thumbnail of Composition of Government Budget, Non-Single Peakedness, and Majority Voting

Journal of Public Economic Theory, 2001

In this paper we study whether majority voting equilibria exist when preferences over public poli... more In this paper we study whether majority voting equilibria exist when preferences over public policies are not single peaked. The government levies a proportional income tax. Tax revenue is used to finance a uniform lump-sum transfer and public education. Individuals vote on the composition of the government budget. We show that the single-crossing property cannot be invoked to establish existence of a majority voting equilibrium. In a simple parametric example we find that cycles are pervasive.

Research paper thumbnail of Opting Out of Publicly Provided Service: A Majority Voting Result

Research paper thumbnail of Public education and income inequality

European Journal of Political Economy, 2003

This paper examines the evolution of inequality in an overlapping generations model where each in... more This paper examines the evolution of inequality in an overlapping generations model where each individual's human capital investment depends on quality of schools. We consider an education regime where the quality of schools is a publicly provided input financed by an income tax. We show that the income gap between the rich and the poor may widen even when the quality of public education is the same across all individuals. Thus, in the short run, public education may not be the great equalizer as intended by its proponents, though it is in the long run. We also show that the effect of taxes on inequality is ambiguous. D

Research paper thumbnail of Public investment in infrastructure in a simple growth model

Journal of Economic Dynamics & Control, 1994

In this paper, we examine the implications for capital accumulation when infrastructure enters as... more In this paper, we examine the implications for capital accumulation when infrastructure enters as an external input into private production functions. In our model, infrastructure is nonexclusive but may exhibit varying degrees of nonrivalry. Revenues from uniform taxes on capital ...

Research paper thumbnail of Whatever happened to the Kuznets curve? Is it really upside down

Journal of Income Distribution, 1997

Kuznets (1955) embarked on a research program whose goal was to find the determinants of the long... more Kuznets (1955) embarked on a research program whose goal was to find the determinants of the long run levels and trends in income inequality and the relationship between income inequality and economic growth. Recently a small body of theoretical work has developed which tries to obtain the inverted U hypothesis as an equilibrium outcome in dynamic general equilibrium model. One

Research paper thumbnail of Flat-Rate Taxes, Government Spending on Education, and Growth

Review of Economic Dynamics, 1998

We address three questions in this paper. First, what is the impact on growth of changes in flat-... more We address three questions in this paper. First, what is the impact on growth of changes in flat-rate taxes when government spending on education affects private decisions to accumulate human capital? Second, are the growth effects negligible when we ...

Research paper thumbnail of Endogenous public policy and multiple equilibria

European Journal of Political Economy, 1996

One of the well known roles of public policy in models with indeterminacy is to reduce the set of... more One of the well known roles of public policy in models with indeterminacy is to reduce the set of equilibria. However, agents' expectations regarding future policy may be self fulfilling when public policy is endogenized. We show that a simple overlapping generations economy with public education may yield multiple equilibria. Under a laissez-faire system, our model has a unique equilibrium.

Research paper thumbnail of Opting out of publicly provided services: A majority voting result

Social Choice and Welfare, 1998

Our objective in this paper is to examine majority voting in an environment where both public and... more Our objective in this paper is to examine majority voting in an environment where both public and private alternatives coexist. We construct a model in which households are differentiated by income and have the option of choosing between publicly provided services and private services. Publicly provided services are financed through income tax revenues and made available to all citizens at zero price. Majority voting determines the tax rate. Even though preferences over tax rates are not single peaked, we provide conditions under which a majority voting equilibrium exists. We illustrate our existence result with CES preferences and a Dagum income distribution.

Research paper thumbnail of On the political economy of means-tested education vouchers

European Economic Review, 2000

We use computational experiments to study the impact of means-tested education vouchers on the le... more We use computational experiments to study the impact of means-tested education vouchers on the level and distribution of educational expenditures. Our benchmark is a regime where public and private schools coexist. Our means-tested voucher regime is one where households with lower incomes receive a larger voucher. Both the level of funding and the allocation of vouchers by income are endogenously determined by sequential majority voting. We examine the e!ect on educational expenditures of switching from a mixed public/private education regime to a means-tested voucher regime or to a uniform voucher regime where all households receive the same voucher. We "nd that: (i) Under means-tested vouchers, public funding for education is the smallest but average educational expenditure is the largest; (ii) inequality of educational resources is smaller under means-tested than that under uniform vouchers or the mixed regime; (iii) the &poor' and the &rich' households prefer means testing to either the mixed or uniform regime.

Research paper thumbnail of Opting our of Publically Provided Services: A M ajority Voting Result

Research paper thumbnail of Human capital accumulation and endogenous public expenditures

Canadian Journal of Economics-revue Canadienne D Economique, 2001

In this paper, we present an overlapping-generations model, where individuals accumulate human ca... more In this paper, we present an overlapping-generations model, where individuals accumulate human capital through formal schooling. We model the role of the public sector in schooling as one of collecting taxes from households and providing inputs to the learning technology. Public expenditures on schools are determined endogenously. Under plausible restrictions, our model's predictions qualitatively match the observations on schooling, public expenditures on education, and student-teacher ratios. JEL Classification: E13, E62.

Research paper thumbnail of Productive government expenditures and long-run growth

Journal of Economic Dynamics & Control, 1997

... National Tax Journal, 121134. Jones, LE and R. Manuelli, 1990, A convex model of equilibrium ... more ... National Tax Journal, 121134. Jones, LE and R. Manuelli, 1990, A convex model of equilibrium growth. ... 204 G. Glomm, B. Ravikumar Journal of Economic Dynamics and Control 21 (1997) 183204 Kocherlakota, N. and KM Yi, 1994a, Is there endogenous long run growth? ...

Research paper thumbnail of Increasing returns, human capital, and the Kuznets curve

Journal of Development Economics, 1998

We present a simple model of human capital accumulation which generates the Kuznets curve as an e... more We present a simple model of human capital accumulation which generates the Kuznets curve as an equilibrium outcome. The central ingredient that helps generate the Kuznets curve in the model is what we call short-run increasing returns to scale in the learning technology. The learning technology exhibits increasing returns to scale, but only in the short run, since one of the factors of production, time, is bounded above by the endowment. We show that short-run increasing returns to scale is necessary to obtain the Kuznets curve, but not sufficient.

Research paper thumbnail of Public versus Private Investment in Human Capital Endogenous Growth and Income Inequality

Journal of Political Economy, 1992

... for part b is similar since equation (9) has the same implications as (7). But note that even... more ... for part b is similar since equation (9) has the same implications as (7). But note that even if -y + 8 < 1, income inequality in the ... of human capital tomorrow is not only a function of his private stock today but also a function of the average human capital stock of society today. ...