Intergenerational Redistribution with Short-Lived Governments

Gene Grossman and Elhanan Helpman

No 5447, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We study the politics of intergenerational redistribution in an overlapping generations model with short-lived governments. The successive governmentsþwho care about the welfare of the currently living generations and possibly about campaign contributionsþare unable to pre-commit the future course of redistributive taxation. In a stationary politico-economic equilibrium, the tax rate in each period depends on the current value of the state variable and all expectations about future political outcomes are fulfilled. We find that there exist multiple stationary equilibria in many political settings. Steady-state welfare is often lower than it would be in the absence of redistributive politics.

JEL-codes: D72 E62 (search for similar items in EconPapers)
Date: 1996-01
Note: EFG PE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Published as Economic Journal, Vol. 108, no. 45 (September 1998): 1299-1325.

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Related works:
Journal Article: Intergenerational Redistribution with Short-Lived Governments (1998)
Working Paper: Intergenerational Redistribution with Short-lived Governments (1996)
Working Paper: Intergenerational Redistribution with Short-Lived Governments (1996)
Working Paper: Intergenerational Redistribution with Short-Lived Governements (1996)
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