We construct a model to examine the impacts of an increase in the skilled labor input to public education on the output of final goods, environmental goods, and pollution emissions, in which skill formation is incorporated into the traditional Ricardo-Viner (RV) model. Due to the inclusion skill formation, one of the specific factors (skilled labor) and a mobile factor (unskilled labor) are endogenously determined, unlike in the traditional RV model. We then show that an increase in public education service may have negative effects on the output through changes in the wages of skilled and unskilled labor, as well as the rental rate of real capital, all due to the skill formation process. However, we also show the conditions that must be met in order for public education to promote environmental protection.
JEL Classification:F10, F18, Q58
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