Year: 2007
Type: book
Abstract: We propose a theoretical framework and present empirical evidence to analyze how democracy aggregates preferences when these differ both within and across wealth classes. We show that when politicians belonging to different groups can form coalitions, the wealthy elites’ influence on policy choices endogenously increases with the diversity in preferences among the poor. In line with the theoretical predictions, the pattern of public good provision and income transfer policies by local governments in Indonesia reveals that when individuals have different preferences —here due to different ethnicity— democratic policy outcomes reflect the preferences of the elites and of the ethnic minority, rather than the preferences of the poor majority.
Authors: Oriana Bandiera, Gilat Levy
Institution: London School of Economics and Political Science
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: green
Funder: European Commission
OpenAlex ID: W1580750122