The Right Type of Legislator: A Theory of Taxation and Representation

Working Paper No. 24279 We develop a theory of taxation and the distribution of government spending in a citizen-candidate model of legislatures. Individuals are heterogeneous in two dimensions: productive ability in the private sector and negotiating ability in politics. When these are positively c...

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Bibliographic Details
Published inNBER Working Paper Series p. 24279
Main Authors Mattozzi, Andrea, Snowberg, Erik
Format Paper
LanguageEnglish
Published Cambridge National Bureau of Economic Research, Inc 01.02.2018
Subjects
Economic models
Economic theory
Government spending
Legislation
Politics
Taxation
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Summary:Working Paper No. 24279 We develop a theory of taxation and the distribution of government spending in a citizen-candidate model of legislatures. Individuals are heterogeneous in two dimensions: productive ability in the private sector and negotiating ability in politics. When these are positively correlated, rich voters always prefer a rich legislator, but poor voters face a trade-off. A rich legislator will secure more pork for the district, but will also prefer lower taxation than the poor voter. Our theory organizes a number of stylized facts across countries about taxation and redistribution, parties, and class representation in legislatures. We demonstrate that spending does not necessarily increase when the number of legislators increases, as the standard common-pool intuition suggests, and that many policies aimed at increasing descriptive representation may have the opposite effect.
ISSN:0898-2937
DOI:10.3386/w24279