Recent evidence of increasing income heterogeneity within developed countries has reignited debates concerning the redistribution of income and wealth. In this article, we contribute to this debate by assessing the role of individuals’ jurisdictional identification for their preferences toward intrafederation redistributive financial flows. Incorporating insights from social identity theory in a model of redistributive taxation, we show that federal, rather than local, identification can lead individuals to shift their redistribution preferences independent of their narrowly defined personal economic interests. Moreover, contrary to conventional wisdom, welfare state support will sometimes be decreasing in national identification. We empirically assess these predictions using individual-level data from the 2008 German General Social Survey (ALLBUS) and a 2013-2014 survey among Belgian local politicians. Our findings provide strong support for the model’s core predictions in both settings.
AkerlofG. A.KrantonR. E. (2000). Economics and identity. Quarterly Journal of Economics, 115, 715-753.
2.
AlesinaA.BaqirR.EasterlyW. (1999). Public goods and ethnic divisions. Quarterly Journal of Economics, 114, 1167-1199.
3.
AlesinaA.La FerraraE. (2005). Ethnic diversity and economic performance. Journal of Economic Literature, 43, 762-800.
4.
AshworthJ.HeyndelsB.SmoldersC. (2002). Redistribution as a local public good: An empirical test for Flemish municipalities. Kyklos, 55, 27-56.
5.
BalcellsL.Fernandez-AlbertosJ.KuoA. (2015). Preferences for inter-regional redistribution. Comparative Political Studies, 48, 1318-1351.
6.
BechtelM. M.HainmuellerJ.MargalitY. M. (2014). Preferences for international redistribution: The divide over the Eurozone bailouts. American Journal of Political Science, 58, 835-856.
7.
BeckerG. S. (1981). Altruism in the family and selfishness in the market place. Economica, 48, 1-15.
8.
BellaniL.ScerviniF. (2015). Heterogeneous preferences and in-kind redistribution: Theory and evidence. European Economic Review, 78, 196-219.
9.
BoltonP.RolandG. (1996). Distributional conflicts, factor mobility, and political integration. American Economic Review, 86, 99-104.
10.
BoyerD. C. (2000). On the sedimentation and accreditation of social knowledges of difference: Mass media, journalism, and the reproduction of East/West alterities in unified Germany. Cultural Anthropology, 15, 459-491.
11.
BrownR. J.TurnerJ. C. (1979). The criss-cross categorization effect in intergroup discrimination. British Journal of Clinical Psychology, 18, 371-383.
GiritligilA. E.ÇağlayanD. (2017, April28). In-group favoritism vs. social efficiency concerns. Paper presented at the International Meeting on Experimental and Behavioral Social Sciences, Barcelona, Spain.
14.
ChenY.LiS. X. (2009). Group identity and social preferences. American Economic Review, 99, 431-457.
15.
Costa-i-FontJ.CowellF. (2015). Social identity and redistributive preferences: A survey. Journal of Economic Surveys, 29, 357-374.
16.
DahlbergM.EdmarkK.LundqvistH. (2012). Ethnic diversity and preferences for redistribution. Journal of Political Economy, 120, 41-76.
17.
DanieleG.GeysB. (2015). Public support for European fiscal integration in times of crisis. Journal of European Public Policy, 22, 650-670.
DeschouwerK. (2012). The politics of Belgium: Governing a divided society. Basingstoke, UK: Palgrave Macmillan.
20.
De WitteK.GeysB. (2013). Citizen coproduction and efficient public good provision: Theory and evidence from local public libraries. European Journal of Operational Research, 224, 592-602.
21.
DoosjeB.EllemersN.SpearsR. (1995). Perceived intragroup variability as a function of group status and identification. Journal of Experimental Social Psychology, 31, 410-436.
22.
EllemersN. (1993). The influence of socio-structural variables on identity enhancement strategies. European Review of Social Psychology, 4, 27-57.
23.
EssesV. M.DovidioJ. F.JacksonL. M.ArmstrongT. L. (2001). The immigration dilemma: The role of perceived group competition, ethnic prejudice, and national identity. Journal of Social Issues, 57, 389-412.
24.
FrankR. H. (1985). Choosing the right pond: Human behavior and the quest for status. New York, NY: Oxford University Press.
25.
FreierR.GeysB.HolmJ. (2016). Religious heterogeneity and fiscal policy: Evidence from German reunification. Journal of Urban Economics, 94, 1-12.
26.
GESIS—Leibniz Institute for the Social Sciences. (2015). ALLBUS/GGSS 2008 (Allgemeine Bevölkerungsumfrage der Sozialwissenschaften/German General Social Survey 2008) [Data set] (GESIS Data Archive, ZA4600 Data file Version 2.1.0). Cologne, North Rhine-Westphalia. doi:10.4232/1.12345
27.
GeysB.VermeirJ. (2014). Party cues in elections under multilevel governance: Theory and evidence from U.S. states. Journal of the European Economic Association, 12, 1029-1058.
28.
HabyarimanaJ.HumphreysM.PosnerD. N.WeinsteinJ. M. (2007). Why does ethnic diversity undermine public goods provision?American Political Science Review, 101, 709-725.
29.
HatfieldJ. W.Padro-i-MiquelG. (2012). A political economy theory of partial decentralization. Journal of the European Economic Association, 10, 605-633.
30.
HochmanH. M.RodgersJ. D. (1969). Pareto optimal redistribution. American Economic Review, 59, 542-557.
31.
HoggM. A.TerryD. J. (2001). Social identity theory and organizational processes. In HoggM. A.TerryD. J. (Eds.), Social identity processes in organizational contexts (pp. 1-12). Philadelphia, PA: Psychology Press.
32.
HolmJ. (2016). A model of redistribution under social identification in heterogeneous federations. Journal of Public Economics, 143, 39-48.
33.
HolmJ.KuehnhanssC. R.MahieuB.HeyndelsB. (2017). Region, nation, and redistribution: Experimental evidence on social identity and policy preferences among Belgian local politicians. Brussels, Belgium: Vrije Universiteit Brussel.
34.
HoogheL. (1993). Belgium: From regionalism to federalism. Regional and Federal Studies, 3(1), 44-68.
35.
HoogheL. (2004). Belgium: Hollowing the center. In AmorettiU.BermeoN. (Eds.), Federalism, unitarism, and territorial cleavages (pp. 55-92). Baltimore, MD: Johns Hopkins University Press.
36.
HorstmannI. J.ScharfK. A. (2008). A theory of distributional conflict, voluntarism and segregation. Economic Journal, 118, 427-453.
37.
HowardM. (1995). An East German ethnicity? Understanding the new division of unified Germany. German Politics and Society, 13(4), 49-70.
38.
Jofre-MonsenyJ.Sorribas-NavarroP.Vazquez-GrennoJ. (2016). Immigration and local spending in social services: Evidence from a massive immigration wave. International Tax and Public Finance, 23, 1004-1029.
39.
JohnstonR.BantingK.KymlickaW.SorokaS. (2010). National identity and support for the welfare state. Canadian Journal of Political Science, 43, 349-377.
40.
KlorE.ShayoM. (2010). Social identity and preferences over redistribution. Journal of Public Economics, 94, 269-278.
41.
KonradK. A. (2004). Altruism and envy in contests: An evolutionarily stable symbiosis. Social Choice and Welfare, 22, 479-490.
KuziemkoI.NortonM. I.SaezE.StantchevaS. (2015). How elastic are preferences for redistribution? Evidence from randomized survey experiments. American Economic Review, 105, 1478-1508.
44.
LindqvistE.ÖstlingR. (2013). Identity and redistribution. Public Choice, 155, 469-491.
45.
LjungqvistL.UhligH. (2000). Tax policy and aggregate demand management under catching up with the Joneses. American Economic Review, 90, 356-366.
46.
MarshallT. H. (1950). Citizenship and social class, and other essays. Cambridge, UK: Cambridge University Press.
47.
McFaddenD. (1974). Conditional logit analysis of qualitative choice behavior. In ZarembkaP. (Ed.), Frontiers in econometrics (pp. 105-142). New York, NY: Academic Press.
48.
MeltzerA. H.RichardS. F. (1981). A rational theory of the size of government. Journal of Political Economy, 89, 914-927.
49.
MyersonR. B. (2006). Federalism and the incentives for success of democracy. Quarterly Journal of Political Science, 1, 3-23.
50.
PikettyT. (2014). Capital in the twenty-first century. Cambridge, MA: Harvard University Press.
51.
SeabrightP. (1996). Accountability and decentralization in government: An incomplete contracts model. European Economic Review, 40(1), 61-89.
ShayoM. (2009). A model of social identity with an application to political economy: Nation, class, and redistribution. American Political Science Review, 103, 147-174.
54.
TajfelH.TurnerJ. (1986). The social identity theory of intergroup behavior. In WorchelS.AustinW. G. (Eds.), Psychology of intergroup relations (pp. 7-24). Chicago, IL: NelsonHall.
55.
TransueJ. E. (2007). Identity salience, identity acceptance, and racial policy attitudes: American national identity as a uniting force. American Journal of Political Science, 51, 78-91.
56.
WhitakerG. P. (1980). Co-production: Citizen participation in service delivery. Public Administration Review, 40, 240-246.
57.
WrightM.ReeskensT. (2013). Of what cloth are the ties that bind? National identity and support for the welfare state across 29 European countries. Journal of European Public Policy, 20, 1443-1463.
Supplementary Material
Please find the following supplemental material available below.
For Open Access articles published under a Creative Commons License, all supplemental material carries the same license as the article it is associated with.
For non-Open Access articles published, all supplemental material carries a non-exclusive license, and permission requests for re-use of supplemental material or any part of supplemental material shall be sent directly to the copyright owner as specified in the copyright notice associated with the article.
