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178 Working Paper

Redistribution and the Political Economy of Education: An Analysis of Individual Preferences in OECD Countries 2


The issue of skill formation features prominently in the literature on the political economy of redistribution. But surprisingly, the study of the micro foundations of education policy preferences has largely been ignored so far. This paper provides a first step in this direction, relying on survey data for a large number of OCED countries. Challenging the assumptions of established political economy models of the formation of education preferences, it is shown that the individual position on the income scale is not a strong predictor of support for increasing public spending on education. The reason for this non-finding is that the association between income and preferences varies across countries and institutional contexts. The core hypothesis of the paper is that levels of economic inequality and the degree of stratification of the education system strongly affect and shape the redistributive political economy of education on the micro level. The empirical part of the paper employs a two-stage hierarchical model specification to provide evidence for this claim.