Disincentives from Redistribution: Evidence on a Dividend of Democracy

Rupert Sausgruber, Axel Sonntag, Jean-Robert Tyran

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.

Vienna Center for Experimental Economics, Department of Economics
External organisation(s)
Wirtschaftsuniversität Wien (WU), IHS - Institut für Höhere Studien und wissenschaftliche Forschung
Publication date
Austrian Fields of Science 2012
502057 Experimental economics, 502045 Behavioural economics
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