Distributive policy with labor mobility and the Samaritanfs dilemma

Kohei Daido () and Ken Tabata

No 44, Discussion Paper Series from School of Economics, Kwansei Gakuin University

Abstract: We consider a model with two countries in which each government redistributes income between two types of individuals (the rich and the poor). This model shows that an increase in the mobility of individuals induces intensive tax competition across countries and lowers the level of redistribution undertaken by each country. However, this lower level of redistribution enhances individualsf efforts to raise his own labor income and alleviates the consequences of the Samaritanfs dilemma. Welfare evaluation of economic integration should be based on the balance of these two competing effects.

Keywords: Redistribution; Samaritanfs; dilemma; Migration; Economic; integration; Psychological attachment (search for similar items in EconPapers)
JEL-codes: C72 F15 F22 H53 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mig
Date: 2009-01, Revised 2009-01

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Persistent link: http://EconPapers.repec.org/RePEc:kgu:wpaper:44

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