January 11, 2021
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Resident Fellow Ignacio Campomanes tells us about his paper The Political Economy of Inequality, Mobility and Redistribution.

How does the interaction between inequality and social mobility affect the choice of fiscal policy? I analyze this question in a model of democratic politics with imperfect tax enforcement, where the ability of individuals to evade taxes limits the amount of redistribution in the economy. Social mobility creates an insurance motive that increases voluntary compliance, favoring the t...