Formation of nations in a welfare-state minded world

Nir Dagan, Oscar Volij

Research output: Contribution to journalArticlepeer-review

5 Scopus citations

Abstract

We model the endogenous formation of nations in a world economy where nations apply redistributive policies. We show that people's preference for stronger redistributive policies may lead to greater inequality in the world's distribution of income as a result of rich individuals tending to form their own nations. By the same token, stable economic integration occurs only when redistributive policies are not too strong.

Original languageEnglish
Pages (from-to)157-181
Number of pages25
JournalJournal of Public Economic Theory
Volume2
Issue number2
DOIs
StatePublished - 1 Dec 2000
Externally publishedYes

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