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Does Mobility Undermine Income Redistribution? A Political-Support Approach to Redistribution in a Federation

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  • Kangoh Lee

Abstract

This paper considers a positive model of income redistribution with mobile individuals in a federal system. The politician of a jurisdiction makes redistributive policy to maximize political support from poor welfare recipients and rich taxpayers. If only the poor move, a politician redistributes more than without mobility in an attempt to gain support from the poor. If the rich also move, an increase in the redistributive tax imposed on the rich drives out the rich, decreasing the rich's political opposition. The exodus of the rich, however, may decrease tax revenues available for income redistribution, decreasing the poor's political support. The mobility thus may increase or decrease income redistribution.

Suggested Citation

  • Kangoh Lee, 2007. "Does Mobility Undermine Income Redistribution? A Political-Support Approach to Redistribution in a Federation," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 63(2), pages 186-210, June.
    • Handle: RePEc:mhr:finarc:urn:sici:0015-2218(200706)63:2_186:dmuira_2.0.tx_2-q
    DOI: 10.1628/001522107X220071
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    References listed on IDEAS

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    1. Kira Boerner & Silke Uebelmesser, 2007. "Migration and the welfare state: The economic power of the non-voter?," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 14(1), pages 93-111, February.
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    6. Borjas, George J, 1999. "Immigration and Welfare Magnets," Journal of Labor Economics, University of Chicago Press, vol. 17(4), pages 607-637, October.
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    Cited by:

    1. Sigrid Roehrs & David Stadelmann, 2010. "Mobility and local income redistribution," Working Papers 2010/4, Institut d'Economia de Barcelona (IEB).
    2. Sigrid Röhrs & David Stadelmann, 2014. "Homeownership, Mobility, And Local Income Redistribution," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 16(4), pages 569-605, August.
    3. Sigrid Roehrs & David Stadelmann, 2010. "Mobility and local income redistribution," Working Papers 2010/4, Institut d'Economia de Barcelona (IEB).

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    More about this item

    Keywords

    redistribution; mobility; political support;
    All these keywords.

    JEL classification:

    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism

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