Is The Median Voter Hypothesis Valid in Developed Countries?

Yasin Karadenä°z

Fiscaoeconomia, 2025, issue 1

Abstract: According to the median-voter hypothesis, the size of the public sector in terms of the redistribution of income is determined by the majority rule. This hypothesis suggests that an increase in average income relative to median income increases the size of government, because voters that have the median income are the decision-making voters. The meaning of the size of the public sector here is social expenditures, tax rates, and public debts. This paper aims to analyze the validity of the median-voter hypothesis on the basis of 24 developed countries for the period 2004-2018. Results of the analysis conducted via the Arellano-Bover/Blundell-Bond Two-Stage System Generalized Method of Moments influentially support the claims of the median voter hypothesis about social expenditures, tax rates, and public debts. Results are also valid in terms of their different versions that include control variables of the constructed master patterns.

Keywords: Median Voter Hypothesis; Public Debts; Social Expenditures; Marginal Tax Rate; Dynamic Panel Data Analysis (search for similar items in EconPapers)
JEL-codes: C23 H20 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:fis:journl:250117

DOI: 10.25295/fsecon.1451286

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