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Redistribution from a constitutional perspective

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  • Joachim Wessels

Abstract

In its traditional form, Paretian welfare economics has little to say about policies of redistribution. I argue that by adopting a constitutional perspective, elements of a theory of redistribution can be developed without recourse to interpersonal utility comparisons. Individuals who find themselves under an imperfect veil of uncertainty at a constitutional stage face a tradeoff between the costs and benefits of redistribution. The benefits consist of a reduction in the variance of a risk-averse agent's income distribution. The costs are represented by deadweight losses caused either by bureaucracy or by disincentive effects associated with the transfer scheme. My simple formal analysis shows that individuals may, even under an imperfect veil of uncertainty, be able to agree unanimously on a certain transfer policy if their personal characteristics are not too different from each other. Copyright George Mason University 1993

Suggested Citation

  • Joachim Wessels, 1993. "Redistribution from a constitutional perspective," Constitutional Political Economy, Springer, vol. 4(3), pages 425-448, September.
    • Handle: RePEc:kap:copoec:v:4:y:1993:i:3:p:425-448
    DOI: 10.1007/BF02393270
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    References listed on IDEAS

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    1. Bishop, John A & Formby, John P & Smith, W James, 1991. "Incomplete Information, Income Redistribution and Risk Averse Median Voter Behavior," Public Choice, Springer, vol. 68(1-3), pages 41-55, January.
    2. James Buchanan, 1993. "How can constitutions be designed so that politicians who seek to serve “public interest” can survive and prosper?," Constitutional Political Economy, Springer, vol. 4(1), pages 1-6, December.
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    1. Danziger, Leif & Ursprung, Heinrich W., 2001. "Risk aversion and social mobility: the implausibility of order-preserving income redistributions," Economics Letters, Elsevier, vol. 74(1), pages 9-13, December.
    2. Leif Danziger & Heinrich Ursprung, 2000. "Risk-Aversion and Social Mobility: The Impossibility of Order-Preserving Income Redistributions," CESifo Working Paper Series 321, CESifo.
    3. Dailami, Mansoor, 1999. "Managing risks of capital mobility," Policy Research Working Paper Series 2199, The World Bank.
    4. Luke Petach, 2022. "A Tullock Index for assessing the effectiveness of redistribution," Public Choice, Springer, vol. 191(1), pages 137-159, April.

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