Policy Preferences of Latin American Rising Elites

• In Event: Public Opinion: Market Conditioning, Opportunity, and Redistributive Policies

Abstract

Research has shown, in Latin America and around the world, that economic elites are actors with disproportionate weight in democracies. Because of their political clout, this paper focuses on understanding their ideas about two pressing issues in Latin America: poverty and inequality. Under what conditions are elites more willing to support tax increases meant to finance social programs? Are they more willing to support tax increases meant to combat poverty as opposed to inequality? Do their ideas about inefficient and corrupt states affect their support for taxes? To explore these questions, I conduct a survey experiment among “rising elites”, defined as rich Latin American MBA students in the United States.

The experiment’s design is built upon interviews conducted with 150 elites across three countries. Two dimensions stand out when probing elite support for social policies: whether they are meant to target poverty as opposed to inequality, and whether they believe the state can do so efficiently. Based on this, I first expose respondents to news articles on the effects of the economic downturn in their country: one emphasizes the increased poverty rates and worsening living conditions, while the other highlights how the rich increased their wealth, deepening economic gaps. Following this initial framing, participants are then exposed to a vignette about a tax-increase proposal to fund social programs, which are either managed by the government or by an association of business people, replicating real experiences that exist at local scales around Latin America.

In line with expectations, rising elites are significantly more likely to support tax-increase initiatives when these are managed by a business trust. The levels of support are indistinct regardless of the framing that precedes the tax proposal (poverty vs. inequality). However, this framing does make a difference in support levels for a government-managed tax (i.e. taxes as we usually think of them). When the tax proposal is preceded by a poverty-focused news snippet (as opposed to an inequality-focused one), the support levels are significantly higher.

This paper makes a substantial contribution to the literature on elite preferences and political behavior, which is mostly centered on descriptive methods. In addition, it provides valuable insight for policymakers by illustrating how different framings of the same policy can elicit different levels of support from elites.

Author

• Pilar Manzi, Northwestern University