A political economy of loose means-testing in targeted social programs
Helmuth Cremer,
Justina Klimaviciute and
Pierre Pestiau ()
Additional contact information
Pierre Pestiau: Université catholique de Louvain, LIDAM/CORE, Belgium
Authors registered in the RePEc Author Service: Pierre Pestieau
No 2020036, LIDAM Discussion Papers CORE from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE)
Abstract:
This paper studies the political sustainability of programs that are targeted towards the poor. Given that the poor to whom these programs cater do not constitute a majority, we show that for their own good it pays to let the middle class benefit from them in a random way. This approach mimics the actual institutional arrangements whereby middle-class individuals feel that they can successfully apply to the programs. We consider a two stage decision process: first a Rawlsian government chooses the probability at which the middle class is allowed to benefit from a given program; then, majority voting determines the level of benefit and the rate of contribution. At the first, constitutional stage, the government cannot commit to a specific level of taxes and benefit but anticipates that these are set by majority voting in the second stage.
Keywords: Targeted transfers; Political support; Redistribution paradox (search for similar items in EconPapers)
JEL-codes: D72 H23 H50 (search for similar items in EconPapers)
Pages: 9
Date: 2020-12-01
New Economics Papers: this item is included in nep-cdm, nep-mic and nep-pol
References: View references in EconPapers View complete reference list from CitEc
Citations:
Downloads: (external link)
https://sites.uclouvain.be/core/publications/coredp/coredp2020.html (application/pdf)
Related works:
Journal Article: A political economy of loose means-testing in targeted social programs (2021) 
Working Paper: A political economy of loose means-testing in targeted social programs (2021)
Working Paper: A political economy of loose means-testing in targeted social programs (2021) 
Working Paper: A political economy of loose means-testing in targeted social programs (2021) 
Working Paper: A political economy of loose means-testing in targeted social programs (2020) 
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:cor:louvco:2020036
Access Statistics for this paper
More papers in LIDAM Discussion Papers CORE from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) Voie du Roman Pays 34, 1348 Louvain-la-Neuve (Belgium). Contact information at EDIRC.
Bibliographic data for series maintained by Alain GILLIS ().