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Political Reinforcement: How Rising Inequality Curbs Manifested Welfare Generosity

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  • Erling Barth
  • Henning Finseraas
  • Karl O. Moene

Abstract

We propose a political reinforcement hypothesis, suggesting that rising inequality moves party politics on welfare state issues to the right, strengthening rather than modifying the impact of inequality. We model policy platforms by incorporating ideology and opportunism of party members and interests and sympathies of voters. If welfare spending is a normal good within income classes, a majority of voters moves rightward when inequality increases. As a response, the left, in particular, shift their welfare policy platform toward less generosity. We find support for our arguments using data on the welfare policy platforms of political parties in 22 OECD countries.

Suggested Citation

  • Erling Barth & Henning Finseraas & Karl O. Moene, 2015. "Political Reinforcement: How Rising Inequality Curbs Manifested Welfare Generosity," American Journal of Political Science, John Wiley & Sons, vol. 59(3), pages 565-577, July.
  • Handle: RePEc:wly:amposc:v:59:y:2015:i:3:p:565-577
    DOI: 10.1111/ajps.12129
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    Cited by:

    1. LIM, Taejun & KIM, Aram, 2023. "How Progressive Is the Most Popular Tax Scheme? The Case of South Korea," Hitotsubashi Journal of Economics, Hitotsubashi University, vol. 64(1), pages 1-17, June.
    2. Roberto Iacono, 2018. "The Nordic Model of Economic Development and Welfare: Recent Developments and Future Prospects," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 53(4), pages 185-190, July.
    3. Apoorva Lal & Mac Lockhart & Yiqing Xu & Ziwen Zu, 2023. "How Much Should We Trust Instrumental Variable Estimates in Political Science? Practical Advice Based on Over 60 Replicated Studies," Papers 2303.11399, arXiv.org, revised Nov 2023.
    4. Frédéric Cherbonnier & Christian Gollier, 2022. "Risk-adjusted Social Discount Rates," Post-Print hal-04012977, HAL.
    5. Peter John, 2018. "Theories of policy change and variation reconsidered: a prospectus for the political economy of public policy," Policy Sciences, Springer;Society of Policy Sciences, vol. 51(1), pages 1-16, March.
    6. Boarini, Romina & Causa, Orsetta & Fleurbaey, Marc & Grimalda, Gianluca & Woolard, Ingrid, 2018. "Reducing inequalities and strengthening social cohesion through inclusive growth: A roadmap for action," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 12, pages 1-26.
    7. Erik Bengtsson, 2014. "Labour's share in twentieth-century Sweden: a reinterpretation," Scandinavian Economic History Review, Taylor & Francis Journals, vol. 62(3), pages 290-314, November.
    8. Roberto Iacono, 2019. "The Norwegian Oil Bonanza and the Scandinavian Model in Comparative Perspective," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 61(1), pages 63-82, March.
    9. Stiglitz, Joseph E., 2015. "Leaders and followers: Perspectives on the Nordic model and the economics of innovation," Journal of Public Economics, Elsevier, vol. 127(C), pages 3-16.

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