Barrett, The Honors College Thesis/Creative Project Collection
Barrett, The Honors College at Arizona State University proudly showcases the work of undergraduate honors students by sharing this collection exclusively with the ASU community.
Barrett accepts high performing, academically engaged undergraduate students and works with them in collaboration with all of the other academic units at Arizona State University. All Barrett students complete a thesis or creative project which is an opportunity to explore an intellectual interest and produce an original piece of scholarly research. The thesis or creative project is supervised and defended in front of a faculty committee. Students are able to engage with professors who are nationally recognized in their fields and committed to working with honors students. Completing a Barrett thesis or creative project is an opportunity for undergraduate honors students to contribute to the ASU academic community in a meaningful way.
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- Creators: Dean, W.P. Carey School of Business
Description
This paper explores the potential impact of population aging trends on support for the financing of public education using an applied theoretical approach. As demographic projections anticipate significant increases in the relative share of elderly individuals in the population, the question of how age distribution in a population effects support for public goods such as education becomes increasingly significant. Conventional wisdom suggests that an upward shift in age distribution – increasing the share of elderly individuals relative to workers – will result in decreased support for public education due to elderly individuals’ lack of utility from investments in future productivity. This paper demonstrates that such conventional wisdom does not hold in a simple two-district overlapping generations model and shows that an increasing share of elderly individuals in the population may result in increased levels of funding for education due to changes in a district’s tax base.
The model developed in this paper builds on the work of Mark Gradstein and Michael Kaganovich who demonstrated that while increasing longevity in a two-generation OLG model with two municipal districts creates a downward pressure on tax rates, this effect is dominated by changing political incentives among workers. This paper expands upon the Gradstein-Kaganovich model by introducing endogenous migration rates between districts in the model in order to reflect households’ incentives to minimize tax burden in retirement. It can be shown that as consumers’ responsiveness to differences in tax rates increases, the difference in education funding levels between districts decreases despite the difference in the relative share of elderly individuals in each population increasing. This result stems from the changes in each districts’ tax base brought on by the endogenous migration rate. Based on this finding, this study concludes that retirees function as a positive financial externality when education funding is tied to consumption levels and reaffirms Gradstein and Kaganovich’s conclusion that increasing the relative share of elderly individuals in a population does not necessarily result in decreased funding for public education as conventional wisdom would suggest.
The model developed in this paper builds on the work of Mark Gradstein and Michael Kaganovich who demonstrated that while increasing longevity in a two-generation OLG model with two municipal districts creates a downward pressure on tax rates, this effect is dominated by changing political incentives among workers. This paper expands upon the Gradstein-Kaganovich model by introducing endogenous migration rates between districts in the model in order to reflect households’ incentives to minimize tax burden in retirement. It can be shown that as consumers’ responsiveness to differences in tax rates increases, the difference in education funding levels between districts decreases despite the difference in the relative share of elderly individuals in each population increasing. This result stems from the changes in each districts’ tax base brought on by the endogenous migration rate. Based on this finding, this study concludes that retirees function as a positive financial externality when education funding is tied to consumption levels and reaffirms Gradstein and Kaganovich’s conclusion that increasing the relative share of elderly individuals in a population does not necessarily result in decreased funding for public education as conventional wisdom would suggest.
ContributorsMerkle, Matthew Connor (Author) / Foster, William (Thesis director) / Murphy, Alvin (Committee member) / Department of Economics (Contributor, Contributor) / School of Mathematical and Statistical Sciences (Contributor) / Dean, W.P. Carey School of Business (Contributor) / Barrett, The Honors College (Contributor)
Created2019-05
Description
This paper proposes that voter decision making is determined by more than just the policy positions adopted by the candidates in the election as proposed by Antony Downs (1957). Using a vector valued voting model proposed by William Foster (2014), voter behavior can be described by a mathematical model. Voters assign scores to candidates based on both policy and non-policy considerations, then voters then decide which candidate they support based on which has a higher candidate score. The traditional assumption that most of the population will vote is replaced by a function describing the probability of voting based on candidate scores assigned by individual voters. If the voter's likelihood of voting is not certain, but rather modelled by a sigmoid curve, it has radical implications on party decisions and actions taken during an election cycle. The model also includes a significant interaction term between the candidate scores and the differential between the scores which enhances the Downsian model. The thesis is proposed in a similar manner to Downs' original presentation, including several allegorical and hypothetical examples of the model in action. The results of the model reveal that single issue voters can have a significant impact on election outcomes, and that the weight of non-policy considerations is high enough that political parties would spend large sums of money on campaigning. Future research will include creating an experiment to verify the interaction terms, as well as adjusting the model for individual costs so that more empirical analysis may be completed.
ContributorsCoulter, Jarod Maxwell (Author) / Foster, William (Thesis director) / Goegan, Brian (Committee member) / School of Mathematical and Statistical Sciences (Contributor) / Department of Economics (Contributor) / Dean, W.P. Carey School of Business (Contributor) / Barrett, The Honors College (Contributor)
Created2019-05