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Cover von: Voting, Wealth Heterogeneity, and Endogenous Labor Supply
Chetan Ghate

Voting, Wealth Heterogeneity, and Endogenous Labor Supply

Rubrik: Articles
Jahrgang 63 (2007) / Heft 4, S. 477-497 (21)
Publiziert 09.07.2018
DOI 10.1628/001522107X268989
Veröffentlicht auf Englisch.
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Beschreibung
We examine the link between voting outcomes, wealth heterogeneity, and endogenous labor-leisure choice in the majority-voting-endogenous-growth frameworks of Alesina and Rodrik (1994) and Das and Ghate (2004). We augment these frameworks to incorporate leisure-dependent utility and allow households to vote on factor-specific income taxes. When agents vote on factor-specific taxes, we show that the asymptotic convergence of factor holdings does not imply unanimity over the growth-maximizing tax policy in the steady state. Unanimity over growth-maximizing policies holds only when agents vote on a general income tax, and when agents vote on factor-specific taxes but labor is exogenous.