Abstract
This paper theoretically examines the link between local taxes and education choice (indicated by private school enrollment rate or public school enrollment rate). The evidence shows that local taxes and parental choice of education are endogenously determined by one another. More importantly, this study frames an economic theoretical background for local taxes and parental choice of education, which can be useful in constructing empirical models for further investigations of this issue.
Highlights
A number of researchers (e.g., Lin and Quayes, 2006 [1]) have demonstrated that local taxes and school performance are significantly related, which suggests that local taxes have a direct effect on education output
Local taxes are the main source of funds for public school districts, which means that they significantly determine the quality of public schools
Local taxes and choice of education rely on parents’ preference, which suggests that local taxes per public school pupil and parental choice of education may be jointly determined
Summary
A number of researchers (e.g., Lin and Quayes, 2006 [1]) have demonstrated that local taxes and school performance are significantly related, which suggests that local taxes have a direct effect on education output. While local taxes are determined by local governments, they are in turn elected by local inhabitants Parents who prefer their children to go to private schools may be not willing to pay taxes to support public schools. Local taxes and choice of education rely on parents’ preference, which suggests that local taxes per public school pupil and parental choice of education may be jointly determined. The purpose of this paper is to build a theoretical framework to link local taxes and parental choice of education. (2016) Building a Theoretical Framework to Link Local Taxes and Parental Choice of Education.
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