2008), “To Segregate or to Integrate: Education Politics and Democracy,” forthcoming in Review of Economic Studies

In most democracies, the majority of education expenditures is financed by the government. In non-democracies, we observe a wide variation in the mix of public and private funding of education. In addition, countries with high in-equality tend to rely more heavily on private schooling. We develop a theory which integrates private decision on education and fertility with voting on pub-lic education expenditures. The theory is able to account for the facts mentioned above. Countries with high inequality exhibit more private education expendi-tures since rich people opt out of the public system. In non-democracies, con-centration of political power leads to multiple equilibria in the determination of public education spending