Federal Reserve Bank of Cleveland
Working Papers (Old Series)
Majority Voting: A Quantitative Investigation
We study the tax systems that arise in a once-and-for-all majority voting equilibrium embedded within a macroeconomic model of inequality. We find that majority voting delivers (i) a small set of outcomes, (ii) zero labor income taxation, and (iii) nearly zero transfers. We find that majority voting, contrary to the literature developed in models without idiosyncratic risk, is quite powerful at restricting outcomes; however, it also delivers predictions inconsistent with observed tax systems.
Cite this item
Daniel R. Carroll & James Dolmas & Eric R. Young, Majority Voting: A Quantitative Investigation, Federal Reserve Bank of Cleveland, Working Papers (Old Series) 1442, 07 Jan 2015.
- D52 - Microeconomics - - General Equilibrium and Disequilibrium - - - Incomplete Markets
- D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
- E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
Keywords: Political Economy; Essential Set; Voting; Inequality; Incomplete Markets
This item with handle RePEc:fip:fedcwp:1442
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