Federal tax burdens and grant benefits to states: The impact of imperfect representation

James Bennett and Eddie Mayberry

Public Choice, 1979, vol. 34, issue 3, 255-269

Abstract: This paper has shown that the observed distribution pattern of federal grants and taxes among states is dependent on more than a simple redistributional motive. As previous studies have shown, the distribution of taxes and some grants does seem to be related to per capita income. However, our analysis reveals the difficulty of imputing altruistic motives to politicians without taking into account the institutional or behavioral environment within which the politician functions. The model we have developed indicates that politicians are largely interested in income distribution only to the extent that it furthers their self-interest. The ability of politicians to improve the welfare of the average citizen of his state will, in part, depend upon his seniority and the number of citizens he represents. Citizens of states with politicians of greater seniority, and who are represented by relatively more politicians are more likely to be treated more favorably by the federal government. In short, not all citizens receive the same quality or quantity of representation. The oft-repeated claim by incumbent politicians that they should be re-elected because their seniority gives them more influence appears to have merit. Taking into account the higher benefits and lower taxes resulting from a six-year senatorial term, the average citizen will find that re-election of the incumbent senator is worth approximately $ 45, other things equal. Copyright Martinus Nijhoff Publishers b.v. 1979

Date: 1979
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DOI: 10.1007/BF00225668

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