Social Ideology and Taxes in a Differentiated Candidates Framework

Stefan Krasa and Mattias K Polborn

No 3503, CESifo Working Paper Series from CESifo

Abstract: How does ideological polarization on non-economic matters influence the size of government? We analyze this question using a differentiated candidates framework: Two office-motivated candidates differ in their (fixed) ideological position and their production function for public goods, and choose which tax rate to propose. We provide conditions under which a unique equilibrium exists. In equilibrium, candidates propose different tax rates, and the extent of economic differentiation is influenced by the distribution and intensity of non-economic preferences in the electorate. In turn, the extent of economic differentiation influences whether parties divide the electorate primarily along economic or social lines.

Keywords: differentiated candidates; policy divergence; ideology (search for similar items in EconPapers)
JEL-codes: D72 (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Social Ideology and Taxes in a Differentiated Candidates Framework (2014)
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