Do Remittances Crowd Out The Government¡¯S Redistributive Policy?
AbstractIn this paper, we develop a political economy model with a voting equilibrium to analyze the impact of remittances in the government¡¯s redistributive policy. Remittances affect the distribution of income and the households¡¯ demand for public redistribution. In this paper we consider the impact of remittances on two types of redistributive programs: a universal and a targeted transfer program. For an economy with targeted public transfers, we identify conditions in which an increase in remittances crowds out the social transfers of the government. If the redistributive program is universal then an increase in remittances actually increases the size of the government¡¯s transfers.
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Bibliographic InfoArticle provided by Chung-Ang Unviersity, Department of Economics in its journal Journal Of Economic Development.
Volume (Year): 35 (2010)
Issue (Month): 4 (December)
Redistribution; Performance of Government; Electoral Competition; Political Economy; Remittances;
Find related papers by JEL classification:
- H2 - Public Economics - - Taxation, Subsidies, and Revenue
- H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
- H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
- P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism
- F24 - International Economics - - International Factor Movements and International Business - - - Remittances
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