The Political Economy of Redistribution Policy
26 Pages Posted: 21 Dec 2016
Date Written: November 23, 2016
We review the literature on the public choice approach to explaining redistribution policies. The focus is on policies that are pursued with the sole reason to redistribute initial endowments. Moreover, we restrict ourselves to redistribution in democracies. In democratic settings, generic redistribution games lack equilibria. Structure-inducing rules that give rise to realistic redistribution patterns may concern the underlying economic model, political institutions, and firmly established preferences, beliefs, and attitudes of the voters. We present the respective lines of argument in turn and then present the related empirical evidence.
Keywords: redistribution, political economy
JEL Classification: D310, D720, I380, P160
Suggested Citation: Suggested Citation