Redistributive Public Employment
31 Pages Posted: 28 Oct 1998 Last revised: 8 May 2000
Date Written: October 1998
Politicians may use disguised' redistributive policies in order to circumvent opposition to explicit tax-transfer schemes. First, we present a theoretical model that formalizes this hypothesis; then we provide evidence that in US cities, politicians use public employment as such a redistributive device. We find that city employment is significantly higher in cities where income inequality and ethnic fragmentation are higher.
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