Do more unequal countries redistribute more? does the median voter hypothesis hold?

About

Countries

Data & Research

Learning

News

Projects & Operations

Publications

Topics

Home > Data & Research > Research > Author Profile > Report Details

Do more unequal countries redistribute more? does the median voter hypothesis hold?, Volume 1

Author:	Milanovic, Branko;	Collection Title:	Policy, Research working paper ; no. WPS 2264
Date Stored:	2000/02/03	Document Date:	1999/12/31
Document Type:	Policy Research Working Paper	Language:	English
Major Sector:	(Historic)Social Protection	Report Number:	WPS2264
Sub Sectors:	Other Social Protection	SubTopics:	Environmental Economics & Policies; Income; Economic Theory & Research; Inequality; Services & Transfers to Poor; Poverty Impact Evaluation; Safety Nets and Transfers
Volume No:	1

Summary: The median voter hypothesis is important to endogenous growth theories because it provides the political mechanisms through which voters in more unequal countries re-distribute a greater proportion of income and thus (it is argued), by blunting incentives, reduce the country's growth rate. But he hypothesis was never properly tested because of lack of data on the distribution of (pre-tax and transfer) factor income across households, and hence on the exact amount of gain by the poorest quintile of poorest half. The author tests the hypothesis using t9 observations drawn from household budget surveys from 24 democracies. The data strongly support the hypothesis that countries with more unequal distribution of factor income redistribute more in favor of the poor - even when the analysis controls for the older people's share in total population (that is, for pension transfers). The evidence on the median voter hypothesis is much weaker. The author does find that middle-income groups gain more (or lose less) through redistribution in countries where initial (factor) income distribution is more unequal. This regularity evaporates, however, when pensions are dropped from social transfers and the focus is strictly on the more re-distributive social transfers.


Official Documents Official, scanned versions of documents (may include signatures, etc.)
File Type		Description	File Size (mb)

	PDF 56 pages	Official version*	3.92 (approx.)
	Text	Text version**


Light-Weight Documents Lighter (less MB) documents which may or may not be the final, official version
File Type		Description	File Size (mb)

	PDF 51 pages	WPS2264	0.27

* The official version is derived from scanning the final, paper copy of the document and is the official,
archived version including all signatures, charts, etc.

** The text version is the OCR text of the final scanned version and is not an accurate representation of the final text.
It is provided solely to benefit users with slow connectivity.

Permanent URL for this page: http://go.worldbank.org/RSZRT16EA0