The effects of economic integration on the provision of mandatory education as a redistributive policy

The aim of this paper is to investigate the implications of increased student mobility on the level of education provided after opening the borders between two similar countries. As a preliminary result, it will be shown that some public provision of mandatory education can be welfare improving when an optimal linear income tax exists. Compared to the autarchic optimal provision level, mandatory education will be underprovided in both countries at the symmetrical Nash equilibrium.Public provision of private goods, education, efficiency, optimal taxation, fiscal competition.