Renegotiation of Social Contracts by Majority Rule
AbstractWe consider renegotiation of social earnings insurance arrangements by majority voting in an economy where ex-ante identical individuals make unobservable private investments in education. We show that voting-based renegotiation can result in a higher expected level of investment in comparison to the case where social insurance is determined by an appointed social planner.
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Bibliographic InfoPaper provided by University of Warwick, Department of Economics in its series The Warwick Economics Research Paper Series (TWERPS) with number 566.
Length: 28 pages
Date of creation: 2000
Date of revision:
INSURANCE ; EDUCATION ; INCOME ; VOTING;
Other versions of this item:
- Dan Anderberg & Carlo Perroni, . "Renegotiation of Social Contracts by Majority Rule," EPRU Working Paper Series 00-15, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.
- H2 - Public Economics - - Taxation, Subsidies, and Revenue
- J2 - Labor and Demographic Economics - - Demand and Supply of Labor
- D8 - Microeconomics - - Information, Knowledge, and Uncertainty
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