When Extremes Meet: Redistribution in a Multiparty Model with Differentiated Parties

35 Pages Posted: 16 Aug 2015

See all articles by Konstantinos Matakos

Konstantinos Matakos

King's College London, Dept. of Political Economy

Dimitrios Xefteris

University of Cyprus

Date Written: August 13, 2015

Abstract

In this paper we consider a multi-party electoral competition model in which parties -- which care both about implemented policy and their electoral performance -- strategically promise a redistribution scheme while their social ideologies are considered to be known and fixed (differentiated parties). Voters, who differ both in income and in social ideologies, vote sincerely for the party that they cumulatively like most (that is, taking into account both the redistribution scheme proposals and parties' social ideologies). Formal analysis of this game uncovers an ends-against-the-middle equilibrium: parties with moderate social ideologies tend to be in favour of generous redistribution, while parties with extremist social ideologies are more likely to fervently oppose such schemes. An implication of this result is that, ceteris paribus, an increase in income inequality should lead to an increase in the cumulative vote share of moderate parties and, hence, in a decrease in party-system fragmentation.

Keywords: redistributive politics, taxation, differentiated candidates, policy motives, social polarization, multi-party elections

JEL Classification: D72, H20

Suggested Citation

Matakos, Konstantinos and Xefteris, Dimitrios, When Extremes Meet: Redistribution in a Multiparty Model with Differentiated Parties (August 13, 2015). Available at SSRN: https://ssrn.com/abstract=2644478 or http://dx.doi.org/10.2139/ssrn.2644478

Konstantinos Matakos (Contact Author)

King's College London, Dept. of Political Economy ( email )

Strand Campus
London, WC2R 2LS
United Kingdom

HOME PAGE: http://https://sites.google.com/site/kostasmatakos/

Dimitrios Xefteris

University of Cyprus ( email )

75 Kallipoleos Street
P.O. Box 20537
1678 Nicosia
Cyprus

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