The Redistributive Consequences of Segregation
57 Pages Posted: 21 Dec 2017
Date Written: December 21, 2017
In this paper I present a model in which an increase in inequality can lead to a decrease in voters' demand for redistribution. In my model, people sort into groups according to income and as a result they become biased about the shape of the income distribution. I demonstrate that an increase in inequality can lead to a decrease in perceived inequality in the presence of segregation, and hence to a fall in peoples support for redistribution. I motivate my main assumptions with empirical evidence from a small survey that I conducted via Amazon Mechanical Turk.
Keywords: Personal Income Distribution, Inequality, Redistribution
JEL Classification: D31, D83, H24, H53
Suggested Citation: Suggested Citation