Response to Isabela Mares's review of Inequality and Democratization: An Elite-Competition Approach
In: Perspectives on politics, Band 15, Heft 2, S. 565-566
ISSN: 1541-0986
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In: Perspectives on politics, Band 15, Heft 2, S. 565-566
ISSN: 1541-0986
Several recent studies link rising income inequality in the United States to the global financial crisis, arguing that US politicians did not respond to growing inequality with fiscal redistribution. Instead, Americans saved less and borrowed more to maintain relative consumption in the face of widening economic disparities. This article proposes a theory in which fiscal redistribution dampens the willingness of citizens to borrow to fund current consumption. A key implication is that pretax inequality will be more tightly linked with credit in less redistributive countries. The long-run partisan composition of government is, in turn, a key determinant of redistributive effort. Examining a panel of eighteen OECD democracies, the authors find that countries with limited histories of left-wing participation in government are significantly more likely see credit expansion as prefisc inequality grows compared to those in which the political left has been more influential.
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In: APSA 2014 Annual Meeting Paper
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Working paper
In: APSA 2011 Annual Meeting Paper
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Working paper
In: APSA 2010 Annual Meeting Paper
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Working paper
In: APSA 2009 Toronto Meeting Paper
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Working paper
In: Economics & politics, Band 30, Heft 3, S. 307-339
ISSN: 1468-0343
In recent years, global imbalances have channeled the excess savings of surplus countries toward the real estate markets of deficit countries. By consequence, the deficit countries that attracted lots of foreign capital experienced large run‐ups in house prices, whereas most surplus countries that exported capital exhibited flat or slow house price growth. We first use new house price data and a novel instrumental variable design to show the causal relationship between housing prices and capital inflows, particularly through debt bonanzas. We then argue that international capital flows affect the fiscal policy preferences of both voters and political parties by way of their impact on housing prices. Where capital inflows are large and housing prices are rising, we expect voters to respond by demanding both lower taxes and less publicly‐provided social insurance because rising house prices allow homeowners to self‐insure against income loss. In contrast, declining house prices produce greater demands for social insurance, particularly among those most exposed to housing market risk. We present evidence from two cross‐national surveys that supports these claims, as well as a "before and after" analysis of the housing crash in Eastern Europe. We also show that the connection between house prices and social policy also manifests itself in government spending outcomes, mediated by partisan control.
In: Economics & Politics, Band 30, Heft 3, S. 307-339
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In: Economics & Politics, 2018, DOI: 10.1111/ecpo.12111
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Working paper
In: Studies in contemporary European history 9
In: American political science review, Band 106, Heft 2, S. 386-407
ISSN: 0003-0554