How do Economic Circumstances Determine Preferences? Evidence from Long-run Panel Data

Preferences for redistribution and social spending are correlated with income and unemployment risk, but it is unclear how these relationships come about. I build a theory emphasizing that only large changes in economic circumstances provide the information and motivation needed for people to change...

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Bibliographic Details
Published inBritish journal of political science Vol. 49; no. 4; pp. 1381 - 1406
Main Author O’Grady, Tom
Format Journal Article
LanguageEnglish
Published Cambridge, UK Cambridge University Press 01.10.2019
Subjects
Datasets
Economic models
Expenditures
Families & family life
Ideology
Income distribution
Inequality
Intergenerational mobility
Labor market
Longitudinal studies
Motivation
Occupational mobility
Panel data
Parents & parenting
Political behavior
Political economy
Political science
Preferences
Public opinion
Redistribution
Social policy
Socialization
Unemployment
Variables
Voters
social policy
redistribution
public opinion
comparative political economy
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Summary:Preferences for redistribution and social spending are correlated with income and unemployment risk, but it is unclear how these relationships come about. I build a theory emphasizing that only large changes in economic circumstances provide the information and motivation needed for people to change their preferences. Stable long-run preferences are shaped mainly by early socialization, which includes economic and ideological influences from the family, and early labor market experiences. Enduring shocks, low intergenerational mobility and the tendency of left-wing parents to be poorer generate correlations between circumstances and preferences. Because preferences are stable, greater inequality may not increase aggregate support for redistribution. Support is found for the theory with panel data from Switzerland, using a range of empirical tests.
ISSN:0007-1234
1469-2112
DOI:10.1017/S0007123417000242