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Distributive Politics and Economic Ideology

  • Lopez-Rodriguez, David

This paper presents a theoretical model to investigate the effect of heterogeneous ideological preferences over the public provision of goods on both the scope of government spending and the electoral competition among political parties. The proposed model points out that the presence of both ideological politicians who compete for of ce and electoral uncertainty generate a partisanship effect on economic policy. In particular, pro-market (right-wing) politicians commit to lower public provision of goods and income taxation schedules that implement larger income inequality than pro-government (left-wing) politicians. The model also predicts that the public funding of godos through income taxation confers an electoral advantage to pro-market ideological positions. In fact, pro-market politicians can court moderate pro-leftist voters by promises of higher net income that pro-government politicians are not willing to fund. As a result, a right-wing party exhibits larger chances of winning elections, and its policy proposal determines lower ideological sacri�ce than for the left-wing party.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 44145.

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Date of creation: 2011
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Handle: RePEc:pra:mprapa:44145
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  1. Edward L. Glaeser & Giacomo A. M. Ponzetto & Jesse M. Shapiro, 2004. "Strategic Extremism: Why Republicans and Democrats Divide on Religious Values," Harvard Institute of Economic Research Working Papers 2044, Harvard - Institute of Economic Research.
  2. Persson, Torsten & Tabellini, Guido, 1998. "The size and scope of government: Comparative politics with rational politicians," Seminar Papers 658, Stockholm University, Institute for International Economic Studies.
  3. Benabou, Roland & Tirole, Jean, 2004. "Belief in a Just World and Redistributive Politics," Papers 08-15-2005a, Princeton University, Research Program in Political Economy.
  4. Timothy Besley & Anne Case, 2003. "Political Institutions and Policy Choices: Evidence from the United States," Journal of Economic Literature, American Economic Association, vol. 41(1), pages 7-73, March.
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  6. Tim Besley & Stephen Coate, . "An Economic Model of Representative Democracy," Penn CARESS Working Papers ecf70d639d700dba5327ab0c8, Penn Economics Department.
  7. La Ferrara, Eliana & Alesina, Alberto, 2005. "Preferences for Redistribution in the Land of Opportunities," Scholarly Articles 4552533, Harvard University Department of Economics.
  8. Janet Currie & Firouz Gahvari, 2008. "Transfers in Cash and In-Kind: Theory Meets the Data," Journal of Economic Literature, American Economic Association, vol. 46(2), pages 333-83, June.
  9. Alberto Alesina & George-Marios Angeletos, 2004. "Fairness and Redistribution," NajEcon Working Paper Reviews 122247000000000306, www.najecon.org.
  10. Alberto Alesina & Eliana La Ferrara, 2001. "Preferences for Redistribution in the Land of Opportunities," NBER Working Papers 8267, National Bureau of Economic Research, Inc.
  11. Gian Maria Milesi-Ferretti & Roberto Perotti & Massimo Rostagno, 2002. "Electoral Systems And Public Spending," The Quarterly Journal of Economics, MIT Press, vol. 117(2), pages 609-657, May.
  12. Fuchs-Schundeln, Nicola & Alesina, Alberto, 2007. "Good-Bye Lenin (Or Not?): The Effect of Communism on People's Preferences," Scholarly Articles 4553032, Harvard University Department of Economics.
  13. Osborne, Martin J & Slivinski, Al, 1996. "A Model of Political Competition with Citizen-Candidates," The Quarterly Journal of Economics, MIT Press, vol. 111(1), pages 65-96, February.
  14. Timothy Besley & Torsten Persson & Daniel M. Sturm, 2010. "Political Competition, Policy and Growth: Theory and Evidence from the United States," CEP Discussion Papers dp1009, Centre for Economic Performance, LSE.
  15. Piketty, Thomas, 1995. "Social Mobility and Redistributive Politics," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 551-84, August.
  16. Timothy Besley & Torsten Persson & Daniel M. Sturm, 2010. "Political Competition, Policy and Growth: Theory and Evidence from the US," Review of Economic Studies, Oxford University Press, vol. 77(4), pages 1329-1352.
  17. Wittman, Donald, 1977. "Candidates with policy preferences: A dynamic model," Journal of Economic Theory, Elsevier, vol. 14(1), pages 180-189, February.
  18. Fernando Ferreira & Joseph Gyourko, 2007. "Do Political Parties Matter? Evidence from U.S. Cities," NBER Working Papers 13535, National Bureau of Economic Research, Inc.
  19. Fong, Christina, 2001. "Social preferences, self-interest, and the demand for redistribution," Journal of Public Economics, Elsevier, vol. 82(2), pages 225-246, November.
  20. Alesina, Alberto, 1988. "Credibility and Policy Convergence in a Two-Party System with Rational Voters," American Economic Review, American Economic Association, vol. 78(4), pages 796-805, September.
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