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Party age and party color : new results on the political economy of redistribution and inequality

Author

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  • Keefer, Philip
  • Milanovic, Branko

Abstract

This paper advances research on inequality with unique, new data on income distribution in 61 countries, including 20 Latin American countries, to explore the effects of political parties on redistribution. First, consistent with a central -- but still contested -- assumption of the political economy literature, left-wing governments redistribute more. In addition, consistent with recent research on the importance of party organization and the organizational differences between younger and older parties, older left-wing parties are more likely to internalize the long-run costs of redistribution and to be more credible in their commitment to redistribution, leading them to redistribute less. With entirely different data, the paper also provides evidence on mechanisms: left-wing governments not only redistribute more, they tax more; older left-wing parties, though, tax less than younger ones.

Suggested Citation

  • Keefer, Philip & Milanovic, Branko, 2014. "Party age and party color : new results on the political economy of redistribution and inequality," Policy Research Working Paper Series 7129, The World Bank.
  • Handle: RePEc:wbk:wbrwps:7129
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    References listed on IDEAS

    as
    1. Alberto Alesina & Dani Rodrik, 1994. "Distributive Politics and Economic Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 109(2), pages 465-490.
    2. Francesco Scervini, 2012. "Empirics of the median voter: democracy, redistribution and the role of the middle class," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 10(4), pages 529-550, December.
    3. Dani Rodrik, 1998. "Why Do More Open Economies Have Bigger Governments?," Journal of Political Economy, University of Chicago Press, vol. 106(5), pages 997-1032, October.
    4. Ernesto H. Stein & Lorena Caro, 2013. "Ideology and Taxation in Latin America," Research Department Publications IDB-WP-407, Inter-American Development Bank, Research Department.
    5. Milanovic, Branko, 2010. "Four critiques of the redistribution hypothesis: An assessment," European Journal of Political Economy, Elsevier, vol. 26(1), pages 147-154, March.
    6. Georgy Egorov & Konstantin Sonin, 2013. "A Political Theory of Populism," The Quarterly Journal of Economics, Oxford University Press, vol. 128(2), pages 771-805.
    7. Persson, Torsten & Tabellini, Guido, 1994. "Is Inequality Harmful for Growth?," American Economic Review, American Economic Association, vol. 84(3), pages 600-621, June.
    8. Milanovic, Branko, 2000. "The median-voter hypothesis, income inequality, and income redistribution: an empirical test with the required data," European Journal of Political Economy, Elsevier, vol. 16(3), pages 367-410, September.
    9. repec:cup:apsrev:v:103:y:2009:i:02:p:147-174_09 is not listed on IDEAS
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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Oui, la gauche redistribue plus que la droite
      by ? in D'un champ l'autre on 2014-12-11 03:21:00

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    1. repec:voj:journl:v:63:y:2016:i:2:p:231-258 is not listed on IDEAS

    More about this item

    Keywords

    Inequality; Emerging Markets; Economic Theory&Research; Poverty Impact Evaluation; Rural Poverty Reduction;

    JEL classification:

    • H0 - Public Economics - - General
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution

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