Citizen Support for the Welfare State: Determinants of Preferences for Income Redistribution

Abstract

This paper explores the determinants of individual level support for income redistribution by the government. It argues that there are two sources of preference formation when it comes to redistribution. People are either in favor of income redistribution because they are disadvantaged, or they favor redistribution as a means to insure against income shocks. The paper explores both logics, but focuses on the latter. Four risk factors are hypothesizes to influence an individual's preferences over income redistribution: a) structural change; b) exposure to international competition; c) specificity of skills; and d) occupational unemployment. Some of these measures are novel. The paper relies on the European Social Survey 2002/2003 in order to test the formulated hypotheses. The results show that a) skill specificity and occupational unemployment are important determinants of individual preferences over redistribution whereas b) structural change and exposure to international competition are not.

Keywords: Public Opinion, Preferences, Redistribution, Varieties of Capitalism, Trade, Unemployment, Occupations

JEL Classification: D31, D72, E24, H53