Social Mobility And Preferences For Open Access Societies

Alexandra Pripadcheva () and Dmitry Veselov
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Alexandra Pripadcheva: National Research University Higher School of Economics

HSE Working papers from National Research University Higher School of Economics

Abstract: This study investigates a dynamic political economy model that provides a link between the intensity of social mobility in society and the barriers to entry on markets in modern democracies. We use overlapping generation model in which all agents are divided by three groups: unskilled workers, skilled workers and capitalists. Social mobility is determined by the parental endogenous education decision and by the level of barriers to entry on markets, which is a political outcome. We show that a majority of voters may support high barriers to entry if perspectives of upward mobility for high-skilled workers is sufficiently low for every institutional set-up and there are direct payments from incumbent capitalists to a group of unskilled workers. This outcome also leads to persistently lower social mobility for every social group and to a lower level of education in the society. The model provides a theoretical justification of the empirical evidence, suggesting that a higher level of economic inequality is associated with a lower quality of economic institutions in democracies.

Keywords: social mobility; economic barriers; economic institutions; democracy (search for similar items in EconPapers)
JEL-codes: J62 O15 O43 P16 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2021
New Economics Papers: this item is included in nep-dge, nep-isf and nep-pol
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Published in WP BRP Series: Economics / EC, September 2021, pages 1-24

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Persistent link: https://EconPapers.repec.org/RePEc:hig:wpaper:250/ec/2021

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