EconPapers    
Economics at your fingertips  
 

The Role of Efficiency of Redistributive Institutions on Redistribution: An Empirical Assessment

Ahmet Aysan

MPRA Paper from University Library of Munich, Germany

Abstract: In spite of both theoretical and empirical contributions to investigate the determinants of redistribution, an important gap remains in the literature, which is the effect of efficiency of redistributive institutions on redistribution. This paper is an attempt to show that the state apparatus with its redistributive institutions plays a major role in determining the size of redistribution. Redistribution is mainly approximated with social security and welfare expenditures by the governments. We utilize the indices of ‘Quality of Bureaucracy’ and ‘Control of Corruption’ from the International Country Risk Guide to quantify efficiency of redistributive institutions. When measures of ERI are incorporated into the existing empirical specifications of income inequality and redistribution, cross-sectional and panel data regressions show that ERI significantly increases redistribution. This result is robust to alternative specifications of the empirical model as well as to alternative data sets. However, we find weaker evidence for the role of income inequality on redistribution. Income inequality does not appear to be strongly significant in various specifications of the redistribution equation. Based on this evidence, this paper concludes that efficiency of redistributive institutions plays an important role in redistribution but this effect does not resolve the fiscal policy puzzle.

Keywords: Income Inequality; Redistribution; Institutions; Governance (search for similar items in EconPapers)
JEL-codes: O1 P48 (search for similar items in EconPapers)
Date: 2005
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/17773/1/MPRA_paper_17773.pdf original version (application/pdf)

Related works:
Working Paper: The Role of Efficiency of Redistributive Institutions on Redistribution: An Empirical Assessment (2006) Downloads
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:pra:mprapa:17773

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().

 
Page updated 2020-08-27
Handle: RePEc:pra:mprapa:17773