IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

On inequality and the allocation of public spending

  • Radhika Lahiri

    ()

    (Queensland University of Technology)

  • Elisabetta Magnani

    ()

    (University of New South Wales)

Empirical evidence on the link between inequality and redistribution mechanisms is inconclusive, and depends on the nature of the mechanism in question. We present a series of political economy models, and the associated results may be interpreted as being consistent with these facts. Specifically, we demonstrate that the link between inequality and redistribution depends on the nature of the mechanism relative to the alternatives that are available. Our analysis suggests that, in the presence of higher inequality, a median voter faced with the choice of the proportion of expenditure between two mechanisms is likely to choose in favour of public goods that are more efficient mechanisms of redistribution. In some cases, inequality does not matter and the proportion of spending on any particular public good is related only to the preference and technology related parameters of the model.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.accessecon.com/pubs/EB/2008/Volume5/EB-08E60013A.pdf
Download Restriction: no

Article provided by AccessEcon in its journal Economics Bulletin.

Volume (Year): 5 (2008)
Issue (Month): 9 ()
Pages: 1-8

as
in new window

Handle: RePEc:ebl:ecbull:eb-08e60013
Contact details of provider:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Douglas Holtz-Eakin & Mary E. Lovely & Mehmet S. Tosun, 2000. "Generational Conflict, Human Capital Accumulation, and Economic Growth," NBER Working Papers 7762, National Bureau of Economic Research, Inc.
  2. Di Gioacchino, Debora & Ginebri, Sergio & Sabani, Laura, 2005. "Inequality, redistribution and the allocation of public spending in education. A political-economy approach," Economics & Statistics Discussion Papers esdp05024, University of Molise, Dept. EGSeI.
  3. Josef ZweimüLler, 2000. "Inequality, Redistribution, and Economic Growth," Empirica, Springer, vol. 27(1), pages 1-20, March.
  4. Kjetil Storesletten, 2000. "Sustaining Fiscal Policy through Immigration," Journal of Political Economy, University of Chicago Press, vol. 108(2), pages 300-323, April.
  5. Jim Dolmas & Gregory W. Huffman, 1998. "On the political economy of immigration and income redistribution," Working Papers 9804, Federal Reserve Bank of Dallas.
  6. Roland Benabou, 2000. "Unequal Societies: Income Distribution and the Social Contract," American Economic Review, American Economic Association, vol. 90(1), pages 96-129, March.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:ebl:ecbull:eb-08e60013. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (John P. Conley)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.