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WHY SMALL GROUPS AND LOW INCOME SECTORS OBTAIN SUBSIDIES: THE “ALTRUISTIC” SIDE OF A “SELF‐INTERESTED” GOVERNMENT *
Author(s) -
SWINNEN JOHAN F. M.,
GORTER HARRY
Publication year - 1993
Publication title -
economics and politics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.822
H-Index - 45
eISSN - 1468-0343
pISSN - 0954-1985
DOI - 10.1111/j.1468-0343.1993.tb00080.x
Subject(s) - subsidy , economics , contradiction , government (linguistics) , politics , per capita , microeconomics , altruism (biology) , public economics , market economy , social psychology , political science , sociology , psychology , philosophy , linguistics , population , demography , epistemology , law
We develop a model of political support seeking politicians and support supplying voters. Based on Downs' original formulation, the framework yields endogenous political weights with both liberal and conservative properties. Our model reconciles the apparent contradiction between models of self‐interested politicians and of governments motivated by social concerns. We show that the “altruistic” aspect of government behavior is consistent with its “self‐interested” behavior. We determine that the Olson‐Becker pressure group model is not unique. An increase in deadweight costs reduces the equilibrium subsidy. Smaller groups receive a larger per capita subsidy. These results are consistent with Becker's model.