Incomplete property rights, redistribution, and welfare
In a world where the private protection of property is costly, government redistribution can lead to an increase in aggregate output. This result is not new. The novelty of this paper lies in specifying the conditions under which this efficiency-enhancing redistribution improves everyone’s welfare including the welfare of those whose labor finances the redistributive program (i.e., the rich) and how this is affected by the protection of property rights. The state may directly enhance economic rights through investments in security and the protection of property or it may indirectly do so through the redistribution of income. Under certain conditions, redistribution becomes desirable in situations where the state has exhausted its ability to enhance efficiency through the direct enforcement of property rights. In this case, redistribution can make all members of a society better off. Specifically, this occurs when the cost of predation is sufficiently low and the technology of private protection of property rights is sufficiently weak. The adverse effects of redistribution may be the consequence but not the cause of state failure. The real cause is a corrupt and inept state.
(This abstract was borrowed from another version of this item.)
Volume (Year): 30 (2008)
Issue (Month): 4 (May)
|Contact details of provider:|| Web page: http://www.springer.com|
|Order Information:||Web: http://www.springer.com/economics/economic+theory/journal/355|
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.:
- 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.
- Dieter Bös & Martin Kolmar, 2000.
"Anarchy, Efficiency and Redistribution,"
Bonn Econ Discussion Papers
bgse10_2000, University of Bonn, Germany.
- Gradstein, Mark, 2004. "Governance and growth," Journal of Development Economics, Elsevier, vol. 73(2), pages 505-518, April.
- Angeletos, George-Marios & Alesina, Alberto, 2005.
"Fairness and Redistribution,"
4553009, Harvard University Department of Economics.
- Grossman, Herschel I., 1995. "Robin hood and the redistribution of property income," European Journal of Political Economy, Elsevier, vol. 11(3), pages 399-410, September.
- Grossman, Herschel I., 2002.
""Make us a king": anarchy, predation, and the state,"
European Journal of Political Economy,
Elsevier, vol. 18(1), pages 31-46, March.
- Herschel I. Grossman, 1997. ""Make Us a King": Anarchy, Predation, and the State," NBER Working Papers 6289, National Bureau of Economic Research, Inc.
- Konrad, Kai A., 2001.
"Investment in the Absence of Property Rights: The Role of Incumbency Advantages,"
CEPR Discussion Papers
3050, C.E.P.R. Discussion Papers.
- Konrad, Kai A., 2002. "Investment in the absence of property rights; the role of incumbency advantages," European Economic Review, Elsevier, vol. 46(8), pages 1521-1537, September.
- Kai A. Konrad, 2002. "Investment in the Absence of Property Rights: The Role of Incumbency Advantages," CESifo Working Paper Series 698, CESifo Group Munich.
- Konrad, Kai A., 2001.
"Investment in the absence of property rights: the role of incumbency advantages
[Investitionsanreize bei unvollständigen Eigentumsrechten: die Rolle von Asymmetrien in Aneignungskonflikten]," Discussion Papers, Research Unit: Market Processes and Governance FS IV 01-18, Social Science Research Center Berlin (WZB).
- Skaperdas, Stergios, 1992.
"Cooperation, Conflict, and Power in the Absence of Property Rights,"
American Economic Review,
American Economic Association, vol. 82(4), pages 720-39, September.
- Skaperdas, S., 1991. "Cooperation, Conflict And Power In The Absence Of Property Rights," Papers 90-91-06a, California Irvine - School of Social Sciences.
- Kanbur, Ravi, 1998.
"Income Distribution and Development,"
179323, Cornell University, Department of Applied Economics and Management.
- Gradstein, Mark, 2002. "Governance and Growth," CEPR Discussion Papers 3270, C.E.P.R. Discussion Papers.
- Rodrik, Dani & Alesina, Alberto, 1994.
"Distributive Politics and Economic Growth,"
4551798, Harvard University Department of Economics.
- Usher, D, 1987. "Theft as a Paradigm for Departures from Efficiency," Oxford Economic Papers, Oxford University Press, vol. 39(2), pages 235-52, June.
- Allen, Douglas W, 2002. "The Rhino's Horn: Incomplete Property Rights and the Optimal Value of an Asset," The Journal of Legal Studies, University of Chicago Press, vol. 31(2), pages S339-58, June.
- Daron Acemoglu & James A. Robinson, 2000.
"Why Did the West Extend the Franchise? Democracy, Inequality, and Growth in Historical Perspective,"
The Quarterly Journal of Economics,
Oxford University Press, vol. 115(4), pages 1167-1199.
- Acemoglu, Daron & Robinson, James A, 1998. "Why did the West Extend the Franchise? Democracy, Inequality and Growth in Historical Perspective," CEPR Discussion Papers 1797, C.E.P.R. Discussion Papers.
- Alberto Alesina & Dani Rodrik, 1994. "Distributive Politics and Economic Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 109(2), pages 465-490.
- Harms, Philipp & Zink, Stefan, 2003. "Limits to redistribution in a democracy: a survey," European Journal of Political Economy, Elsevier, vol. 19(4), pages 651-668, November.
- Mueller,Dennis C., 2003. "Public Choice III," Cambridge Books, Cambridge University Press, number 9780521894753, November.
- Grossman, Herschel I, 1994. "Production, Appropriation, and Land Reform," American Economic Review, American Economic Association, vol. 84(3), pages 705-12, June.
- Palda, Filip, 1999. "Property Rights vs. Redistribution: Which Path to National Wealth?," Public Choice, Springer, vol. 101(1-2), pages 129-45, October.
When requesting a correction, please mention this item's handle: RePEc:spr:sochwe:v:30:y:2008:i:4:p:685-699. 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: (Sonal Shukla)or (Rebekah McClure)
If references are entirely missing, you can add them using this form.