Are Welfare Recipients Dictators in a Democracy? The Political economy of the Negative Income Tax
Philippe Penelle
No 97-01, Working Papers from Harris School of Public Policy Studies, University of Chicago
Abstract:
This paper examines the extent to which a democratic society characterized by an unequal distribution of income, is capable of transforming potential efficiency gains into actual economy-wide welfare gains. The model emphasizes the distortive effects of these potential efficiency gains on the price of the redistributive program faced at various income levels. These distorted prices in turn affect the voting behavior and equilibrium fiscal policy chosen by the people. (JEL H20, H3, H42).
Keywords: welfare; income redistribution; price distortion; fiscal policy; voting behavior; efficiency (search for similar items in EconPapers)
Date: 1997-02
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Persistent link: https://EconPapers.repec.org/RePEc:har:wpaper:9701
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