Discrete Dynamics in Nature and Society 
Volume 2007 (2007), Article ID 71742, 15 pages
doi:10.1155/2007/71742
Research Article

Discrete Stochastic Dynamics of Income Inequality in Education: An Applied Stochastic Model and a Case Study

Ahmet Kara

 Department of Economics, Fatih University, Büyükçekmece 34500, Istanbul, Turkey
Received 26 January 2007; Accepted 31 July 2007

Abstract

This paper develops a model for the discrete stochastic dynamics of economic inequality-induced outcomes in education and demonstrates, in the context of the Turkish higher education sector, that higher incomes lead to higher performance levels; and hence income inequality matters. The paper formulates a stochastic subsidy policy that could help the sector to escape the low performance equilibria, and that could stabilize the sector at relatively higher performance levels.