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Targeting and political support for welfare spending

  • Karl Ove Moene
  • Michael Wallerstein

This paper investigates the political support for social assistance policies in a model in which incomes are stochastic (so that welfare policies have an insurance benefit) and unequal ex ante (so that welfare policies have a redistributive effect). With self-interested voting, narrow targeting may so reduce the probability of receiving benefits for the majority that the majority prefers to eliminate benefits altogether, even though the cost of narrowly targeted benefits is close to zero. In contrast, a majority of self-interested voters always supports positive welfare benefits when the policy is targeted sufficiently broadly. If voters are somewhat altruistic, the impact of targeting on political support for welfare spending diminishes but does not disappear. Copyright Springer-Verlag Berlin Heidelberg 2001

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Article provided by Springer in its journal Economics of Governance.

Volume (Year): 2 (2001)
Issue (Month): 1 (03)
Pages: 3-24

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Handle: RePEc:spr:ecogov:v:2:y:2001:i:1:p:3-24
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  9. Thomas Piketty, 1994. "Social Mobility and Redistributive Politics," Working papers 94-15, Massachusetts Institute of Technology (MIT), Department of Economics.
  10. CASAMATTA, Georges & CREMER, Helmuth & PESTIEAU, Pierre, 1998. "On the political sustainability of redistributive social insurance systems," CORE Discussion Papers 1998038, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  11. Meltzer, Allan H & Richard, Scott F, 1981. "A Rational Theory of the Size of Government," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 914-27, October.
  12. Besley, Timothy & Coate, Stephen, 1995. "The Design of Income Maintenance Programmes," Review of Economic Studies, Wiley Blackwell, vol. 62(2), pages 187-221, April.
  13. Besley, Timothy, 1990. "Means Testing versus Universal Provision in Poverty Alleviation Programmes," Economica, London School of Economics and Political Science, vol. 57(225), pages 119-29, February.
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  15. Jon Elster, 1996. "Transmutation and Misrepresentation," Nordic Journal of Political Economy, Nordic Journal of Political Economy, vol. 23, pages 3-23.
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