Political Reinforcement: How Rising Inequality Curbs Manifested Welfare Generosity

We propose a political reinforcement hypothesis, suggesting that rising inequality moves party politics on welfare state issues to the right, strengthening rather than modifying the impact of inequality. We model policy platforms by incorporating ideology and opportunism of party members, and interests and sympathies of voters. If welfare spending is a normal good within income classes, a majority of voters moves rightwards when inequality increases. As a response the left in particular, shift their welfare policy platform towards less generosity. We find support for our arguments using data on the welfare policy platforms of political parties in 22 OECD countries