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Education, taxation and income inequality: what choices does the median voter make?
[Education , fiscalité et inégalités de revenu : quels choix par l'électeur médian ?]

Author

Listed:
  • Marie-Estelle Binet

    (GAEL - Laboratoire d'Economie Appliquée de Grenoble - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - UGA - Université Grenoble Alpes - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - UGA - Université Grenoble Alpes)

  • Jean Sébastien Pentecôte

    (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR - Université de Rennes - CNRS - Centre National de la Recherche Scientifique)

  • Denis Delgay

    (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR - Université de Rennes - CNRS - Centre National de la Recherche Scientifique)

Abstract

This study is following Meltzer and Richard (1981) on the link between inequality and redistribution studied within the median voter model. We propose an original theoretical framework with heterogeneous choices of qualification by active voters, following the idea put forward by Razin et alii (2002, 2004). We first show how the choice of qualification by the decisive voter directly influences his preferences in terms of income taxation, and vice versa. While a decrease in education costs increases the share of the educated population, its effect on redistribution is contrasted. Economies with similar education costs may choose high or low redistribution rates, despite high inequality. This partly invalidates Meltzer and Richard's result.

Suggested Citation

  • Marie-Estelle Binet & Jean Sébastien Pentecôte & Denis Delgay, 2020. "Education, taxation and income inequality: what choices does the median voter make? [Education , fiscalité et inégalités de revenu : quels choix par l'électeur médian ?]," Post-Print halshs-02922326, HAL.
  • Handle: RePEc:hal:journl:halshs-02922326
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