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Preferences for Redistribution in the Land of Opportunities

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  • La Ferrara, Eliana
  • Alesina, Alberto
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    Abstract

    This paper explores how individual preferences for redistribution depend on future income prospects. In addition to estimating the impact of individuals' socioeconomic background and of their subjective perceptions of future mobility, we employ panel data to construct ‘objective’ measures of expected gains and losses from redistribution for different categories of individuals. We find that such measures have considerable explanatory power and perform better than ‘general mobility’ indexes. We also find that preferences for redistribution respond to individual beliefs on what determines one's position in the social ladder. Ceteris paribus, people who believe that the American society offers 'equal opportunities' are more averse to redistribution.

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    File URL: http://dash.harvard.edu/bitstream/handle/1/4552533/alesinassrn_redistribution.pdf
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    Bibliographic Info

    Paper provided by Harvard University Department of Economics in its series Scholarly Articles with number 4552533.

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    Date of creation: 2005
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    Publication status: Published in Journal of Public Economics
    Handle: RePEc:hrv:faseco:4552533

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    1. Ravallion, Martin & Lokshin, Michael, 2000. "Who wants to redistribute?: The tunnel effect in 1990s Russia," Journal of Public Economics, Elsevier, Elsevier, vol. 76(1), pages 87-104, April.
    2. Bjorklund, Anders & Jantti, Markus, 1997. "Intergenerational Income Mobility in Sweden Compared to the United States," American Economic Review, American Economic Association, American Economic Association, vol. 87(5), pages 1009-18, December.
    3. Alberto Alesina & Stephan Danninger & Massimo Rostagno, 1999. "Redistribution Through Public Employment: The Case of Italy," NBER Working Papers, National Bureau of Economic Research, Inc 7387, National Bureau of Economic Research, Inc.
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