On Political and Economic Determinants of Redistribution: Economic Gains, Ideological Gains, or Institutions?

Gustavo de Souza

No WP 2022-47, Working Paper Series from Federal Reserve Bank of Chicago

Abstract: I describe a structural method to quantify the contribution of different elements of social choice to the level of redistribution. Estimating a DSGE model with microdata on the support for redistribution, I find that if voters disregarded their ideological views on welfare policies, redistribution in the U.S. would increase 117%. Because ideology is a more important determinant of voting behavior than income, increasing voter turnout or capping campaign contributions would have a small effect on redistribution. Among the drivers of ideology, I find that racial animosity and distrust of the government contributes to an 80% and 44% smaller redistribution, respectively.

Keywords: Redistribution; Prefereces for Redistribution; Dynamic Macro Models of Political-Economoy (search for similar items in EconPapers)
JEL-codes: E69 H11 P16 (search for similar items in EconPapers)
Pages: 48
Date: 2022-10-05
New Economics Papers: this item is included in nep-cdm, nep-dge and nep-pol
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Citations: View citations in EconPapers (2)

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https://doi.org/10.21033/wp-2022-47

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