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Schooling, for children between specified ages, is compulsory. However,
not all of these children attend public schools. Parents can elect to
send their children to private schools (which we will assume is the only
alternative to public schooling). There is debate in the community over
the amount of subsidy provided by government to private schools. Some
argue that this subsidy should be eliminated in order to reduce
government outlays on education and that it is wrong for the government
to subsidize private schooling. In the context of the demand and supply
of schooling, evaluate this argument. Hint: Assume that the average
expenditure per student by government on students in public education
must remain constant.
