Inequality, public opinion and redistribution

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. According to the "median-voter" hypothesis, greater inequality in the market distribution of earnings or income tends to produce greater generosity in redistributive policy. We outline the steps in the causal chain specified by the hypothesis and attempt to assess these steps empirically. Prior studies focusing on cross-country variation have found little support for the median-voter model. We examine over-time trends in eight nations during the 1980s and 1990s. Here too the median-voter hypothesis appears to have little utility. Terms of use: Documents inIncome inequality has two components: (1) "market" inequality and (2) government redistribution via taxes and transfers. In principle, the two can be combined in any of a variety of ways: low market inequality with high redistribution, low market inequality with low redistribution, high market inequality with moderate redistribution, and so on. Of particular interest in the study of inequality is what happens when market inequality is high or increases. Does government compensate with high redistribution in order to secure a relatively egalitarian distribution of posttax-posttransfer income? According to one influential theoretical approach, that is indeed what tends to happen. This approach is based on a median-voter model of the politics of redistribution. Its best-known exposition is by Allan Meltzer and Scott Richard (1981). A higher level of market inequality implies a greater distance between * Forthcoming in Socio-Economic Review. Kenworthy: Department of Sociology, University of Arizona, lane.kenworthy@arizona.edu. McCall: Department of Sociology, Northwestern University, l-mccall@northwestern.edu. We are grateful to the Russell Sage Foundation for financial support, to Julian Brash for research assistance, to Jonathan Kelley for generously sharing his calculations, and to Klaus Armingeon, Jessica Epstein, Lloyd Gruber, Julia Lynch, Jonas Pontusson, David Rueda, Stefan Svallfors, and two anonymous SER reviewers for comments on earlier drafts. Inequality, Public Opinion, and Redistribution2 mean and median (pretax-pretransfer) income, with the latter further below the former. The lower the median relative to the mean, the more the median income person or household is likely to benefit from government redistribution, in the sense that the transfers she receives will exceed her share of the tax burden. Hence the greater the amount of redistribution she will favor. More market inequality thus leads t...

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“…Further, research on the effects of aggregate income inequality on health and wellbeing should lead us to be cautious about connecting inequality and class-divides in parenting. While there has been a great deal of research showing that income inequality is associated with worse social outcomes (i.e., Wilkinson and Pickett, 2009), other scholars caution that this work may suffer from problems of omitted variables bias and have suggested more robust analysis strategies that rely less on cross-national, crosssectional comparisons and more on within-state over-time changes in income inequality (Kenworthy and McCall, 2008;Evans, Hout, and Mayer, 2004;Deaton and Lubotsky, 2003), with particular attention to how income inequality may widen class gaps or disparities in important behaviors (Truesdale and Jencks, 2016;Neckerman and Torche, 2007).…”