Title of article :
Redistributive policies with heterogeneous social preferences of voters
Author/Authors :
Dhami، نويسنده , , Sanjit and al-Nowaihi، نويسنده , , Ali، نويسنده ,
Issue Information :
ماهنامه با شماره پیاپی سال 2010
Pages :
17
From page :
743
To page :
759
Abstract :
There is growing evidence on the roles of fairness and other-regarding preferences as fundamental human motives. Call voters with fair preferences, as in Fehr and Schmidt (1999), fair-voters. By contrast, traditional political economy models are based on selfish-voters who derive utility solely from “own” payoff. In a general equilibrium model with endogenous labor supply, a mixture of fair and selfish voters choose optimal policy through majority voting. First, we show that majority voting produces a unique winner in pairwise contests over feasible policies (the Condorcet winner). Second, we show that a preference for greater fairness leads to greater redistribution. An increase in the number of fair voters can also lead to greater redistribution. Third, we show that in economies where the majority are selfish-voters, the decisive policy could be chosen by fair-voters, and vice versa. Fourth, while choosing labor supply, even fair voters behave exactly like selfish voters. We show how this apparently inconsistent behavior in different domains (voting and labor supply) can be rationalized within the model.
Keywords :
direct democracy , Other-regarding preferences , redistribution
Journal title :
European Economic Review
Serial Year :
2010
Journal title :
European Economic Review
Record number :
1798379
Link To Document :
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