Perception of Corruption and Public Support for Redistribution in Latin America
This paper studies the relationship between people's beliefs about the quality of their institutions, as measured by corruption perceptions, and preferences for redistribution in Latin America. Our empirical study is guided by a theoretical model which introduces taxes into Foellmi and Oechslin's (2007) general equilibrium model of non-collusive corruption. In this model perceived corruption influences people's preferences for redistribution through two channels. On the one hand it undermines trust in government, which reduces people's support for redistribution. On the other hand, more corruption decreases own wealth relative to average wealth of below-average-wealth individuals leading to a higher demand for redistribution. Thus, the effect of perceived corruption on redistribution cannot be signed a priori. Our novel empirical findings for Latin America suggest that perceiving corruption in the public sector increases people's support for redistribution. Although the positive channel dominates in the data, we also and evidence for the negative channel from corruption to demand for redistribution via reduced trust.
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- Alesina, Alberto & La Ferrara, Eliana, 2005.
"Preferences for redistribution in the land of opportunities,"
Journal of Public Economics,
Elsevier, vol. 89(5-6), pages 897-931, June.
- Alberto Alesina & Eliana La Ferrara, "undated". "Preferences for Redistribution in the Land of Opportunities," Working Papers 178, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
- Alesina, Alberto F & La Ferrara, Eliana, 2002. "Preferences for Redistribution in the Land of Opportunities," CEPR Discussion Papers 3155, C.E.P.R. Discussion Papers.
- La Ferrara, Eliana & Alesina, Alberto, 2005. "Preferences for Redistribution in the Land of Opportunities," Scholarly Articles 4552533, Harvard University Department of Economics.
- Alberto Alesina & Eliana La Ferrara, 2001. "Preferences for Redistribution in the Land of Opportunities," NBER Working Papers 8267, National Bureau of Economic Research, Inc.
- Alberto Alesina & Eliana La Ferrara, 2001. "Preferences for Redistribution in the Land of Opportunities," Harvard Institute of Economic Research Working Papers 1936, Harvard - Institute of Economic Research.
- Alesina, Alberto & Angeletos, George-Marios, 2005. "Corruption, inequality, and fairness," Journal of Monetary Economics, Elsevier, vol. 52(7), pages 1227-1244, October.
- Alberto Alesina & George-Marios Angeletos, 2005. "Corruption, Inequality and Fairness," Harvard Institute of Economic Research Working Papers 2070, Harvard - Institute of Economic Research.
- Alberto Alesina & George-Marios Angeletos, 2005. "Corruption, Inequality and Fairness," NBER Working Papers 11399, National Bureau of Economic Research, Inc.
- Angeletos, George-Marios & Alesina, Alberto, 2005. "Corruption, Inequality, and Fairness," Scholarly Articles 4553006, Harvard University Department of Economics.
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