Empirical Determinants of In-kind Redistribution: Partisan Biases and the Role of Inflation

Zohal Hessami and Silke Uebelmesser

No 2012-20, Working Paper Series of the Department of Economics, University of Konstanz from Department of Economics, University of Konstanz

Abstract: This paper investigates how government ideology and inflation affect the government’s choice between cash transfers and in-kind transfers. Our hypotheses are based on three observations: (i) in-kind transfers create stigma, (ii) but make recipients less vulnerable to inflation; (iii) poor benefit recipients make up the core constituency of left-wing parties. Using dynamic panel data estimations for 32 OECD countries over the time period from 1980 to 2007, we provide evidence that the in-kind share of social benefits is lower under left-wing governments. This partisan bias is weakened when left-wing governments respond to inflation by increasing the share of in-kind transfers.

Keywords: In-kind redistribution; social benefits; partisan biases; inflation (search for similar items in EconPapers)
JEL-codes: D78 E31 H42 I38 (search for similar items in EconPapers)
Pages: 9 pages
Date: 2012-11-16
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Related works:
Journal Article: Empirical determinants of in-kind redistribution: Partisan biases and the role of inflation (2013)
Working Paper: Empirical determinants of in-kind redistribution: Partisan biases and the role of inflation (2012)
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