Inequality and Redistribution: Political Parties May Matter

Within the framework of the generalized Wittman-Roemer model of political competition, this article provides a canonical example showing that political parties may matter in explaining how redistribution policies change with respect to changes in inequality. Some authors (Lee and Roemer, 2005; Ortuño-Ortín and Roemer, 2000) have noticed that in the Wittman-Roemer model, the left and the right parties may respond differently to changes in inequality, but their observation is based upon numerical calculation. The goal of this paper is to construct an analytically tractable example that helps open the black box with sound intuition.