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Technological Progress and Political Polarization

Author

Listed:
  • INSOOK LEE

    (Bay Area International Business School, Beijing Normal University)

Abstract

How does technological progress affect political polarization? For addressing this question, in an economy where taxation policy is selected by majority-rule voting and voters are differentiated by earning ability, each voter’s own ideal taxation policy is obtained to measure political polarization as distance between left-wing and right-wing voters’ ideal policies. Technological progress exacerbates political polarization, when it is capital-biased by increasing relative capital productivity. In contrast, technological progress does not affect political polarization, when it is unbiased by preserving relative factor productivity. Both biased and unbiased technological progresses do not affect politico-economic distortion, while only the former affects political polarization.

Suggested Citation

  • Insook Lee, 2025. "Technological Progress and Political Polarization," Hacienda Pública Española / Review of Public Economics, IEF, vol. 252(1), pages 29-72, March.
    • Handle: RePEc:hpe:journl:y:2025:v:252:i:1:p:29-72
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    More about this item

    Keywords

    Technological progress; Political polarization; Relative capital productivity; Politico-economic distortion;
    All these keywords.

    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory

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