IISES International Academic Conference, London

THE NICE ROBBER BARONS: ELITES’ SUPPORT IN REDISTRIBUTION AS A SEDUCTION STRATEGY

MORDECHAI E. SCHWARZ

Abstract:

This article explores why certain classes achieved social rights peacefully while others had to fight and the counterintuitive elites’ support for redistribution. Using the overlapping-generations model platform, I describe the economy as a political confederation of sub-economies characterized by different economic horizons and the political process as a recursive biform contest. I show that elites’ support for redistribution is a seduction strategy to sedate political tension through temporary transfers to lower classes while maintaining the elites’ stationary social superiority. Then, I provide necessary conditions for a dynamically consistent social compromise and present an application that explains Director’s law.

Keywords: Overlapping generations, Bargaining, Biform contest, Seduction strategy, Political equilibrium