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Freedom and Redistribution

Author

Listed:
  • Sebastiano Bavetta

    (Università di Palermo and CPNSS London School of Economics)

  • Pietro Navarra

    (Università di Messina and CPNSS London School of Economics)

Abstract

We study the determinants of people’s attitudes toward income inequality and their economic consequences. We argue that attitudes toward inequality depend on the extent of freedom of choice and control over life outcomes an individual enjoys. We construct a two-stage empirical model where people choose the level of income transfers first and their optimal level of effort, then. We find that the higher the extent of an individual’s free choice and control over life outcomes, the greater the probability that he supports larger income differences as incentives for individual effort. This relationship bears consequences on the individual’s willingness to work.

Suggested Citation

  • Sebastiano Bavetta & Pietro Navarra, 2012. "Freedom and Redistribution," Rivista di Politica Economica, SIPI Spa, issue 3, pages 29-49, July-Sept.
    • Handle: RePEc:rpo:ripoec:y:2012:i:3:p:29-49
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    Citations

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    Cited by:

    1. Ludek Kouba & Hans Pitlik, 2014. "I wanna live my life: Locus of Control and Support for the Welfare State," MENDELU Working Papers in Business and Economics 2014-46, Mendel University in Brno, Faculty of Business and Economics.
    2. Pitlik, Hans & Rode, Martin, 2017. "Individualistic values, institutional trust, and interventionist attitudes," Journal of Institutional Economics, Cambridge University Press, vol. 13(3), pages 575-598, September.
    3. Hans Pitlik & Luděk Kouba, 2013. "The Interrelation of Informal Institutions and Governance Quality in Shaping Welfare State Attitudes. WWWforEurope Working Paper No. 38," WIFO Studies, WIFO, number 46924, April.

    More about this item

    Keywords

    freedom autonomy; inequality; taxation; redistribution; political economy;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State

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