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Political Support for Targeted versus Universalistic Welfare Policies

Author

Listed:
  • Karl Ove Moene
  • Michael Wallerstein

Abstract

This paper compares the political support for a targeted and a universalistic welfare policy 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, low benefits may so reduce the probability of receiving benefits for the majority that the majority prefers to reduce benefits even further to zero. In contrast, a majority of self-interested voters always supports positive welfare benefits when the policy is universalistic. If voters are somewhat altruistic, the difference between the equilibrium level of benefits with a universalistic and targeted policy diminishes.

Suggested Citation

  • Karl Ove Moene & Michael Wallerstein, "undated". "Political Support for Targeted versus Universalistic Welfare Policies," IPR working papers 97-2, Institute for Policy Resarch at Northwestern University.
    • Handle: RePEc:wop:nwuipr:97-2
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    Cited by:

    1. Anderberg, Dan, 1999. "Determining the mix of public and private provision of insurance by majority rule," European Journal of Political Economy, Elsevier, vol. 15(3), pages 417-440, September.
    2. Karl Ove Moene & Michael Wallerstein, 2001. "Targeting and political support for welfare spending," Economics of Governance, Springer, vol. 2(1), pages 3-24, March.

    More about this item

    JEL classification:

    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs

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