Journal Article

Inequality and the demand for redistribution: are the assumptions of the new growth theory valid?1

Malte Lübker

in Socio-Economic Review

Published on behalf of Society for the Advancement of Socio-Economics

Volume 5, issue 1, pages 117-148
Published in print January 2007 | ISSN: 1475-1461
Published online March 2006 | e-ISSN: 1475-147X | DOI: http://dx.doi.org/10.1093/ser/mwl002
Inequality and the demand for redistribution: are the assumptions of the new growth theory valid?1

More Like This

Show all results sharing these subjects:

  • Moral Philosophy
  • Corporate Social Responsibility
  • Welfare Economics
  • Political Economy
  • Economic Sociology

GO

Show Summary Details

Preview

One prominent strand of the new growth theory has identified the political process as a potential channel to link high inequality to lower long-term growth. Several authors have argued that (i) higher inequality causes higher demand for redistribution, (ii) which leads to greater redistribution and higher taxes, and (iii) which is in turn harmful to growth. This article addresses the first step of this argument, a proposition that has been widely accepted as a stylized fact. Using cross section data for 26 countries from the ISSP's module on Social Inequality, it presents an empirical test that yields no support for the idea that public support for redistribution rises with inequality across countries. This finding is attributed to the influence of social justice norms that vary greatly between groups of culturally similar countries.

Keywords: income distribution; redistribution; new growth theory; rational choice; political sociology; JEL classification: D31 personal income and wealth distribution, D63 welfare economics, equity, justice, inequality, H24 personal income and other non-business taxes and subsidies, O15 economic development, human resources, income, distribution, migration

Journal Article.  11877 words.  Illustrated.

Subjects: Moral Philosophy ; Corporate Social Responsibility ; Welfare Economics ; Political Economy ; Economic Sociology

Full text: subscription required

How to subscribe Recommend to my Librarian

Users without a subscription are not able to see the full content. Please, subscribe or login to access all content.