@misc{10481/78321,
year = {2022},
month = {11},
url = {https://hdl.handle.net/10481/78321},
abstract = {This paper studies the effect of income inequality and voters’ support for public spending on
the choice of size of the welfare state. Based on new empirical findings showing that preferences
for taxation depend on the nature of the policies financed with tax revenues (Barnes
2015, Ballard-Rosa 2016, Roosma 2016, and Berens 2019) I build a Downsian two-party
political competition framework in which voters differ in both income (rich or poor) and ideology
(liberal or conservative). Government provides two types of public services: one that
increase the size of the welfare state and other that does not. Liberal (conservative) voters
only care about the public service that increase (do not increase) the size of the welfare
state. I find that the decisive voter and the size of the welfare state depends on both the level
of income inequality and voters’ support for public spending. In particular, and different from
the traditional models on redistributive politics (Romer 1975, Roberts 1977, and Meltzer
1981), I obtain that an increase in pre tax income inequality may reduce the size of the welfare
state chosen by majority voting.},
organization = {FEDER/Junta de Andalucía-Consejería de Transformación Económica, Industria, Conocimiento y Universidades/Grant B-SEJ-10-UGR20},
publisher = {Public Library of Science},
title = {Income inequality, voters’ support for public spending and the size of the welfare state. A simple political model},
doi = {10.1371/journal.pone.0277256},
author = {Solano García, Ángel},
}