La regulación leaal lingúistica y la Real Academia de la

I have proposed a framework where political participation is endogenously determined and takes two distinct forms – voting and contributing resources to campaigns – in a context in which individuals recognize that their decisions are not pivotal for aggregate outcomes. In

56_{These results are available upon request.} 57_{See Alesina, Baqir and Hoxby (2004).}

spite of this non-pivotal nature, and endogenous wealth bias emerges in the political process, as a result of the interaction between contributions and voting decisions. When applied to the context of the relationship between inequality and redistribution, the framework shows that such relationship becomes much more subtle than the simple logic of the standard median voter framework would suggest. In equilibrium, redistribution is non-monotonic in inequality, increasing at first but eventually decreasing. In addition, the mechanism behind this interac- tion translates into specific empirical predictions, and US data on campaign contributions and voting behavior in the US suggests that this mechanism has substantial explanatory power.

This framework also sheds light on a host of issues that, while outside the direct scope of this paper, still relate to its building blocks. One such issue has to do with the conse- quences of alternative forms of campaign funding.58 For instance, in the very active debate on campaign finance reform in the US, it is often mentioned that public funding would curtail the disproportionate influence of wealthier individuals and pressure groups on the electoral process. My model suggests that this would indeed be the case, but only if a total ban, or at least very stringent limits, on individual contributions were introduced as well.59 _{In fact,} I can show that, unsurprisingly, the central results of Propositions 4 and 5, concerning the effect of inequality on redistribution, are maintained as long as the contribution limits are not too restrictive.60 _{In particular, what matters is not the limit in absolute terms, but rather in} comparison with the share of income that individuals would be willing to contribute in the absence of limits. Since the latter is likely to be quite small – Ansolabehere, Figueiredo and Snyder (2003) quote the figure of 0.04 percent of national income devoted to political cam- paigns in the US in 2000 – the limits would probably have to be very stringent indeed. In sum, introducing limits on campaign contributions is a way of neutralizing the forces highlighted in the paper – and as such it should be associated, for instance, with a diminished wealth bias in the political system – but it would take very tough limits to do so completely.

Another issue that is raised is that of compulsory voting. If the effect of campaign spending goes through its impact on turnout, one could conclude that, by making turnout compulsory, it would be possible to shut down the mechanism highlighted in the paper. I would suggest that such interpretation would have to be taken with a lot of caution, since in practice there are other ways of using campaign resources to influence electoral outcomes – after all, a lot of resources are spent to mobilize voters even in countries where voting is compulsory. As long as 58_{See Roemer (2006) for a theoretical discussion on the welfare consequences of different forms of campaign}

finance.

59_{This has been the subject of a heated debate in which the Supreme Court has been called to intervene}

many times since the 1970s, as briefly alluded to in the discussion of the data. On this debate on campaign finance reform and the history of legal decisions on the topic, see Corrado et al (2005).

that is the case, the mechanism should still operate. Extending the model to deal with these other ways, such as influencing voters’ preferences, would be a direction in which to push this research in the future. In addition, of course, turnout is well below 100% even when voting is compulsory, which suggests that there is still scope for influencing turnout even when this margin is not as important as it is in the case of the US.

More generally, the framework can be used to analyze other implications of this mechanism beyond the ones addressed in the paper. Any policy choice with a redistributive component can also be studied taking into account the role of contributions and the endogeneity of participation – for instance, the choice of whether to finance primary or tertiary education. Indeed, this framework can be applied whenever policy preferences vary systematically with individual wealth or income – say, if wealthier individuals have a stronger preference for protecting the environment. The endogenous wealth bias should still be present in these other contexts. Topics on comparative politics, such as the redistributive consequences of majoritarian and proportional systems, can also be reassessed under these lenses, as their possibly different implications regarding the role of campaign contributions could translate into different policy outcomes. These are some issues I intend to consider in future work.

On the empirical side, one would like to bring policy outcomes into the picture, which, as stressed before, would require data on inequality, political variables, and policy outcomes to be obtained from the same level – local, state, or country. This would allow for the assessment of many other testable predictions generated by the framework. For instance, this could help assess how much of the cross-country differences in terms of inequality and redistribution can be accounted for by this framework, or test if a greater role of campaign contributions is in fact associated with a stronger “right-wing” bias. Yet another testable prediction of the theory that such data would allow one to pursue would be the presence of a positive relationship between the role of campaign contributions and the strength of the observed link between personal income and turnout. At a sub-national level, this raises issues of data availability, such as obtaining information on redistribution outcomes or campaign contributions at county- or state-level elections. At the cross-country level, it would require a careful consideration of the differences in the political systems between, say, the US and Western Europe with respect to campaign finance, turnout, etc. These are also issues to be tackled by future research.