Disincentives from Redistribution: Evidence on a Dividend of Democracy

Rupert Sausgruber, Axel Sonntag, Jean-Robert Tyran

Publications: Working paper

Abstract

We experimentally study the disincentive effect of taxing work and redistributing tax revenues when redistribution is imposed vs. democratically chosen in a vote. We find a "dividend of democracy" in the sense that the disincentive effect is substantially smaller when redistribution is chosen in a vote than when it is imposed. Redistribution seems to be more legitimate, and hence less demotivating, when accepted in a vote.
Original languageEnglish
Publication statusPublished - 2019

Publication series

SeriesDiscussion papers / Institute of Economics, University of Copenhagen
Number19-08

Austrian Fields of Science 2012

  • 502057 Experimental economics
  • 502045 Behavioural economics

Keywords

  • disincentive effect
  • Lab Experiment
  • Legitimacy
  • Real effort task
  • redistribution
  • voting

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