Prospects of upward mobility and preferences for redistribution: Evidence from the Life in Transition Survey

Alexandru Cojocaru

European Journal of Political Economy, 2014, vol. 34, issue C, 300-314

Abstract: This paper investigates empirically the link between the prospects of upward mobility and preferences for redistribution using data for a large number of countries from the Life in Transition Survey. The survey is unique in that it provides a detailed account of expected future mobility, and makes it possible to differentiate respondents by their degree of risk aversion — both key pillars of the POUM model. The results from the pooled sample, and those for the EU member states confirm the theoretical predictions of Benabou and Ok (2001) — individuals' expectations of upward mobility reduce their preference for redistribution, but only when the degree of risk aversion is low. The POUM hypothesis is not borne out by the data in the non-EU countries.

Keywords: POUM hypothesis; Social mobility; Redistributive preferences; Transition economies (search for similar items in EconPapers)
JEL-codes: D3 I32 P20 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (52)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:poleco:v:34:y:2014:i:c:p:300-314

DOI: 10.1016/j.ejpoleco.2014.03.003

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