ECONOMY

90 political income redistribution
further strengthened if we transplant into his model the assumption of Aumann and
Kurz that one can destroy one’s output.
Another model that allows freedom in choosing the form of the tax schedule
is presented by Snyder and Kramer (1988). These authors allow for considerable
flexibility in the shape of the tax schedule, but they posit a very simple model for
production. In exchange for this simplicity they obtain some remarkably strong
results about tax rates. They show that any non-linear tax schedule, where the net tax
to an individual depends on her market income y: t(y), can be dominated by a linear
one, and that steeper tax schedules can result in less equalizing redistribution than
those that rise more gently (depending on the level of lump-sum taxes or subsidies).
Given an additional condition on the elasticity of labor demand in the underground
economy, Snyder and Kramer show that the equilibrium tax policy will be equivalent
to a linear one. While this result is remarkable, it hinges crucially on unconventional
assumptions about the labor market.
While electoral competition is often modeled in terms of two candidates competing
in a majoritarian system, elections frequently involve non-majoritarian electoral
rules, and multiple candidates. Meyerson (1993) shows that electoral rules have a
profound impact on the sorts of offers candidates will make. He develops a common
framework for comparing various electoral configurations. Candidates compete by
offering redistributive benefits that are uncorrelated with the campaign promises of
other candidates. Imagine the candidates handed out lottery tickets which could be
redeemed if they were elected, while the voters care only about their transfer, so that
each voter ranks the candidates in the order of the size of the transfer each has offered.
Myerson considers a stylized setting with a very large number of voters 11 each of
whom casts a “sincere” vote that reflects his actual preference ranking, and a fixed
amount of money that the winning candidate can distribute if she is victorious. A
key feature of Myerson’s model is that the “lottery tickets” handed out randomly by
candidates cannot be shown to anyone else. Thus, Myerson’s framework precludes
candidates targeting specific groups, and it rules out their making offers contingent
on the offer a voter has from the candidate’s competitors. This assumption makes the
model tractable, but at a significant cost in terms of realism.
Meyerson obtains analytical results for systems involving a “single non-transferable
vote,” which includes the “simple plurality” rule widely used in the United States,
as well as for “Borda Counts,” “negative plurality voting,” and for multiple noncumulative
votes. He also presents simulation results for “approval voting.”
A sense of how the electoral system affects the transfers politicians offer is conveyed
by Meyerson’s analysis of distributive politics under a simple plurality rule, and under
negative approval voting.
The simple plurality rule is probably the system most familiar to the reader: each
voter casts a ballot for one candidate, and the candidate receiving the most votes
is elected. Under negative approval voting, each voter casts one “negative ballot,”
and the candidate receiving the fewest negative ballots is elected. With only two
¹¹ His voters are modeled as a continuum.