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Inequality and the Politics of Redistribution

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  • Tetsuo Ono

    (Graduate School of Economics, Osaka University)

Abstract

This paper analyzes the political economy of public education and in-cash trans- fer in an overlapping generations model of a two-class society in which the dynamics of inequality is driven by the accumulation of human capital. The two redistributive policies are determined by voting, while private education that supplements public education is purchased individually. The model, which includes two-dimensional voting, demonstrates either of the following two types of stable steady-state equilib- ria, which are in line with the evidence: a high-inequality equilibrium with govern- ment expenditure favoring lump-sum transfer, or a low-inequality equilibrium with that favoring public education.

Suggested Citation

  • Tetsuo Ono, 2013. "Inequality and the Politics of Redistribution," Discussion Papers in Economics and Business 12-09-Rev.2, Osaka University, Graduate School of Economics, revised Sep 2014.
    • Handle: RePEc:osk:wpaper:1209r2
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    References listed on IDEAS

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    Cited by:

    1. Vera Tolstova, 2021. "Voting on Education and Redistribution Policies in the U.S: Does Endogenous Fertility Matter?," CERGE-EI Working Papers wp681, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    2. Yuki Uchida & Tetsuo Ono, 2020. "Inequality and education choice," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 27(4), pages 980-1018, August.

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    More about this item

    Keywords

    Public education; political economy; inequality;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality

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