Voting for income-immiserizing redistribution in the Meltzer-Richard model

No Thumbnail Available
Date
2014-01-01
Authors
Barnett, Richard
Bhattacharya, Joydeep
Bunzel, Helle
Major Professor
Advisor
Committee Member
Journal Title
Journal ISSN
Volume Title
Publisher
Authors
Research Projects
Organizational Units
Organizational Unit
Journal Issue
Is Version Of
Versions
Series
Department
Economics
Abstract

This paper argues that income received via redistributive transfers, unlike labor income, requires no direct sacrifice of leisure; this makes it attractive to many voters even if it leaves them poorer. This point is made within the classic Meltzer and Richard (1981) model wherein heterogeneous voters evaluate an income-redistribution program that finances a lump-sum transfer to all via a distorting income tax. The political-equilibrium policy under majority rule is the tax most preferred, utility-wise, by the median voter. Ironically, this voter, and many poorer voters, may support a redistribution policy that leaves them poorer in income terms but with higher utility.

Comments

This is a working paper of an article published in in Economic Inquiry, Vol. 52 iss. 2 (April 2014): 682, doi: 10.1111/ecin.12059

Description
Keywords
Citation
DOI
Copyright
Collections