Identity and Redistribution
Copyright policy )Identity and Redistribution
This paper models the interaction between individuals’ identity choices and redistribution. Both redistributive policies and identity choices are endogenous, and there might be multiple equilibria. The model is applied to ethnicity and social class. In an equilibrium with high taxes, the poor identify as poor and favor high taxes. In an equilibrium with low taxes, at least some of the poor identify with their ethnic group and favor low taxes. The model predicts that redistribution is highest when society is ethnically homogeneous, but the effect of ethnic diversity on redistribution is not necessarily monotonic.
- Stockholm University Sweden
- Massachusetts Institute of Technology United States
- Stockholm School of Economics Sweden
- Research Institute of Industrial Economics Sweden
Income Inequality, ethnic fractionalization, Redistribution; social identity; income inequality; ethnic fractionalization; ethnic diversity; social class, Social Identity, Ethnic Fractionalization, J15, Ethnic Diversity, Soziale Gruppe, ddc:330, social identity, Ethnische Gruppe, Einkommensumverteilung, ethnic diversity, Soziale Schicht, Social Class, Persönlichkeitspsychologie, Redistribution, H20, social class, Theorie, income inequality, jel: jel:H20, jel: jel:J15
Income Inequality, ethnic fractionalization, Redistribution; social identity; income inequality; ethnic fractionalization; ethnic diversity; social class, Social Identity, Ethnic Fractionalization, J15, Ethnic Diversity, Soziale Gruppe, ddc:330, social identity, Ethnische Gruppe, Einkommensumverteilung, ethnic diversity, Soziale Schicht, Social Class, Persönlichkeitspsychologie, Redistribution, H20, social class, Theorie, income inequality, jel: jel:H20, jel: jel:J15
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