Deceptive Redistribution

Simeon Alder and Guillermo Ordonez

Review of Economic Dynamics, 2016, vol. 22, 223-239

Abstract: While some policies can enhance welfare, they may also provide rents to politicians on occasion. Opportunism is usually constrained by the policymakers' reputation concerns. However, if instances of rent-seeking are not easily identified, the strength of this concern hinges critically on the informed constituents' ability to share their knowledge with the rest of society. We show that governments use excessive redistribution to discourage information sharing. In contrast to the standard view that inefficient policies are necessary to implement redistribution, we argue that redistribution can perpetuate inefficient policies that generate private rents. The model matches salient stylized facts on redistribution. (Copyright: Elsevier)

Keywords: Redistribution; Reputation; Private information; Rent-seeking; Media; Election (search for similar items in EconPapers)
Date: 2016
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Related works:
Working Paper: Online Appendix to "Deceptive Redistribution" (2016)
Working Paper: Deceptive Redistribution (2012)
Working Paper: Deceptive Redistribution (2011)
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DOI: 10.1016/j.red.2016.08.003

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