Taxes and Turnout

63 Pages Posted: 19 Dec 2017

See all articles by Felix Bierbrauer

Felix Bierbrauer

University of Cologne - Center for Macroeconomic Research (CMR)

Aleh Tsyvinski

Yale University - Cowles Foundation

Nicolas Werquin

University of Toulouse 1 - Toulouse School of Economics (TSE)

Date Written: December 2017

Abstract

We develop a model of political competition with endogenous turnout and endogenous platforms. Parties face a trade-off between maximizing their base and getting their supporters out to vote. We study the implications of this framework for non-linear income taxation. In equilibrium, both parties propose the same tax policy. This equilibrium policy is a weighted combination of two terms, one reflecting the parties’ payoff from mobilizing their own supporters, one reflecting the payoff from demobilizing the supporters of the other party. The key determinant of the equilibrium policy is the distribution of the voters’ party attachments rather than their propensity to swing vote. Our analysis also provides a novel explanation for why even left-leaning parties may not propose high taxes on the rich.

Suggested Citation

Bierbrauer, Felix and Tsyvinski, Aleh and Werquin, Nicolas, Taxes and Turnout (December 2017). NBER Working Paper No. w24123, Available at SSRN: https://ssrn.com/abstract=3089519

Felix Bierbrauer (Contact Author)

University of Cologne - Center for Macroeconomic Research (CMR) ( email )

Cologne
Germany

Aleh Tsyvinski

Yale University - Cowles Foundation ( email )

28 Hillhouse Ave
New Haven, CT 06520-8268
United States
203-432-9163 (Phone)

Nicolas Werquin

University of Toulouse 1 - Toulouse School of Economics (TSE) ( email )

Place Anatole-France
Toulouse Cedex, F-31042
France

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