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Does inequality harm democracy? An empirical investigation on the UK

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  • A. Soci
  • A. Maccagnan
  • D. Mantovani
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    Abstract

    This paper presents an empirical investigation about the effect of an increase in economic inequality on some aspects of the quality of a democracy. The main novelty of the paper lies in its methodology: it applies to a single country (instead of a pool of countries) - the UK - in a long run perspective. Using survey data, we select three questions and check whether an increase in inequality alters the answers to these questions, subject to other control variables. Another novelty is the use of several measures of inequality (rather than the usual GINI only) both for disentangling what happens in the different parts of the income distribution and for avoiding the dependence of the results on the choice of the indicator. The main finding is that a higher level of income inequality impacts negatively on citizens’ satisfaction with democracy and positively on their political participation.

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    Bibliographic Info

    Paper provided by Dipartimento Scienze Economiche, Universita' di Bologna in its series Working Papers with number wp935.

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    Date of creation: Apr 2014
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    Handle: RePEc:bol:bodewp:wp935

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    1. Hongyi Li & Lyn Squire & Heng-fu Zou, 1998. "Explaining International and Intertemporal Variations in Income Inequality," CEMA Working Papers, China Economics and Management Academy, Central University of Finance and Economics 73, China Economics and Management Academy, Central University of Finance and Economics.
    2. James Foster & Michael Wolfson, 2010. "Polarization and the decline of the middle class: Canada and the U.S," Journal of Economic Inequality, Springer, Springer, vol. 8(2), pages 247-273, June.
    3. Sunde, Uwe & Cervellati, Matteo & Fortunato, Piergiuseppe, 2007. "Are All Democracies Equally Good? The Role of Interactions between Political Environment and Inequality for Rule of Law," IZA Discussion Papers 2984, Institute for the Study of Labor (IZA).
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