Imperfect Information and the Meltzer-Richard Hypothesis

Arbeitspapier

Despite a strong theoretical prediction that income skewness and redistribution should be positively linked, empirical evidence on this issue is mixed. This paper argues that it is important to distinguish between sources of changes in income skewness. Two sources of such changes are discussed: rising polarization and upward mobility, which both increase income skewness. Under imperfect information, these developments affect redistribution in diff erent ways. While rising polarization increases redistribution, upward mobility can have the opposite eff ect. Reasonable degrees of informational imperfection are suffi cient to generate increasing income skewness and decreasing redistribution in the presence of upward mobility.

Object Details

• ISBN: 978-3-86788-246-0
• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Ruhr Economic Papers ; No. 213

Classification and Topics

• Classification: Wirtschaft ; Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior ; Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes ; Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
• Subject: voting ; redistribution ; imperfect information

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Bredemeier, Christian
• Event: Veröffentlichung
• (who): Rheinisch-Westfälisches Institut für Wirtschaftsforschung (RWI)
• (where): Essen
• (when): 2010

Further information

• Handle: http://hdl.handle.net/10419/45351
• Last update: 10.03.2025, 11:42 AM CET