Office-Holding Premia and Representative Democracy

• In Event: Money and Special Interest Influence in Politics

Abstract

I show that in a representative democracy, the predominance of high-income citizens in the legislature may imply that no legislator supports the redistribution policy low-income citizens prefer. Provided redistribution is the salient policy issue, the predominance of high-income citizens cannot arise if low-income citizens still support more redistribution once in office—they have to join high-income citizens in opposing it. I formalize the underlying logic using office-holding premia. High-income citizens can only predominate the legislature if high premia induce low-income citizens to oppose more redistribution once in office. The office-holding premium the predominance of high-income citizens requires increases with income inequality.

Author

• Jan Auerbach, Brunel University London