No abstract

w. 'e develop and test a market-based model to explain variations in states' welfare medicine policy decisions. The empirical results support the model of state policy outputs, indicating that states' spending efforts for welfare medicine are most sensitive to the supply of services within their borders. We leant in addition that spending effort declines with demand for services, indicating that the states spending the highest proportions of total personal income for the program are those who need it most and can afford it least. Measures of political system development affect spending effort positively and significantly, suggesting that ideology, diversity of interests, and administrative professionalism increase states' welfare efforts.

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Why do some voters support income redistribution while others do not? Public assistance programs have two entangled effects on society: they equalize wealth, but they also cushion people against random catastrophes (like natural disasters). The authors conduct a laboratory experiment to determine how individuals’ responses to the environment are related to their self-expressed political ideology and their self-interest. The findings support the hypothesis that ideology is associated with a person’s willingness to use redistribution to reduce income inequality that is caused by luck, but it is not related to preferences for inequality that are not related to luck.

Substantial prior literature has established that subjects in laboratory experiments are typically willing to sacri…ce their own well-being to make …nancial allocations more equal among participants. We test the applicability of this result in an environment that contains some of the key contextual issues that are usually excluded from more abstract games but which might be important in situations involving income redistribution. Our general …nding is that votes for a redistributive tax are almost entirely in accordance with self-interest: above-average earners vote for low tax rates and below-average earners vote for high tax rates. A measure of subjects' preferences for fairness or equality, their self-reported economic ideology, is not directly related to their voting behavior in this experiment. Because the ideology measure should be correlated with any intrinsic preferences regarding inequality aversion, we conclude that any preferences for fairness or inequality that our subjects possess are not strong enough to overcome self-interest in this context. We do, however, …nd evidence for a possible indirect e¤ect of ideology on choice behavior in that more conservative subjects tend to be more responsive to their self-interest than the more liberal subjects.