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Targeting and political support for welfare spending

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  • Karl Ove Moene
  • Michael Wallerstein

Abstract

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

Suggested Citation

  • Karl Ove Moene & Michael Wallerstein, 2001. "Targeting and political support for welfare spending," Economics of Governance, Springer, vol. 2(1), pages 3-24, March.
    • Handle: RePEc:spr:ecogov:v:2:y:2001:i:1:p:3-24
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Michaël Zemmour, 2015. "Economie politique du financement progressif de la protection sociale," Working Papers hal-01205217, HAL.
    2. Sanghamitra Bandyopadhyay & Joan Esteban, 2009. "Redistributive Taxation, PublicExpenditure and the Size of Government," STICERD - Distributional Analysis Research Programme Papers 095, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
    3. De Donder, Philippe & Peluso, Eugenio, 2014. "Politically Sustainable Probabilistic Minority Targeting," TSE Working Papers 14-509, Toulouse School of Economics (TSE).
    4. Philippe De Donder & Eugenio Peluso, 2018. "Politically sustainable targeted transfers," Public Choice, Springer, vol. 174(3), pages 301-313, March.
    5. Philippe De Donder & Eugenio Peluso, 2014. "Politically Sustainable Probabilistic Minority Targeting," CESifo Working Paper Series 4915, CESifo.
    6. Bandyopadhyay, Sanghamitra & Esteban, Joan, 2007. "Redistributive taxation and public expenditures," LSE Research Online Documents on Economics 6537, London School of Economics and Political Science, LSE Library.
    7. Maitreesh Ghatak & François Maniquet, 2019. "Universal basic income: some theoretical aspects," LIDAM Reprints CORE 3056, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    8. Stephan Klasen & Simon Lange, 2015. "Targeting Performance and Poverty Effects of Proxy Means-Tested Transfers: Trade-offs and Challenges," Ibero America Institute for Econ. Research (IAI) Discussion Papers 231, Ibero-America Institute for Economic Research.
    9. Andreas Bergh, 2004. "The Universal Welfare State: Theory and the Case of Sweden," Political Studies, Political Studies Association, vol. 52(4), pages 745-766, December.
    10. Mathieu Lefèbvre, 2007. "The Redistributive Effects of Pension Systems in Europe: A Survey of Evidence," LIS Working papers 457, LIS Cross-National Data Center in Luxembourg.
    11. Hertog, Steffen, 2020. "Reforming wealth distribution in Kuwait: estimating costs and impacts," LSE Research Online Documents on Economics 105564, London School of Economics and Political Science, LSE Library.
    12. Esther Schüring & Franziska Gassmann, 2016. "The political economy of targeting – a critical review," Development Policy Review, Overseas Development Institute, vol. 34(6), pages 809-829, November.
    13. Tugrul Gurgur, 2016. "Voice, exit and local capture in public provision of private goods," Economics of Governance, Springer, vol. 17(4), pages 397-424, November.
    14. Schüring, Esther & Gassmann, Franziska, 2012. "Whom to target: an obvious choice?," MERIT Working Papers 2012-028, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).

    More about this item

    Keywords

    Key words: welfare state; voting; targeting; universal spending; JEL classification: H1; D3;

    JEL classification:

    • H1 - Public Economics - - Structure and Scope of Government
    • D3 - Microeconomics - - Distribution

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