• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

How might ideology and social structure affect the fiscal policy of a democratic government? How universal are the characteristics of these factors?

Extracts from this document...

Introduction

How might ideology and social structure affect the fiscal policy of a democratic government? How universal are the characteristics of these factors? * Socialism is a political doctrine that emphasises the collective ownership of the means of production. It allows limited market activity, ascribing a prominent role to the state in economic management. * Under socialism, redistribution of income from rich to poor is a major policy. In the extreme case, equality of outcome will prevail. Thus, irrespective of ability or effort, each individual will receive an equal income. * Redistribution transfers resources from one segment of society to another. It is known as the Robin Hood effect. This can be implemented via welfare programs, state pensions, healthcare and education. Ultimately redistribution is decided by voters, who indicate their preferences via the democratic system. * Global redistribution has grown significantly over time. In 1900 just 1% of GDP was reallocated. This figure has grown to 18% today. Yet there exist profound intercontinental differences. In the USA just 14% is redistributed, compared to 22% in Europe. This reflects differing attitudes to welfare and individualism across the globe. ...read more.

Middle

Redistribution may be perceived to decrease crime. Thus, individuals may find it in their own interest to help the poor. 4. Equal opportunity. New Labour has redirected its social policy from equal outcome to equal opportunity. This places greater responsibility on the individual. It gives every individual, irrespective of background, an equal chance to 'move up the ladder'. This is coupled with a belief in individualism, which emphasises that government intervention can take away from an individual's fulfilment of his goals. Social justice requires a 'hands off' approach. * Surveys show that few people are unhappy about inequality in the USA. Yet in Europe, the poor consider opportunities to be unequal. Results also indicate that preferences vary across income classes. Whilst, the poorest classes prefer income equality, those with the highest income seem unwilling to share. * It is clear that preferences and social structure differ between continents. In the USA there is a 'pull yourself up by the bootstrap' mentality that reflects the belief in rugged individualism. People fear that welfare encourages dependency on the state. Individuals should fend for themselves. * Similarly, some believe that the prosperous sectors of society should not be forced to share. ...read more.

Conclusion

higher in the US than in Europe'2. * In another paper on preferences for redistribution in the USA, Alesina reiterates that 'individual preferences for redistribution should depend on the extent and the nature of social mobility'3. Again he conducts a statistical test and finds 'individual support for redistribution is negatively affected by social mobility'3. * In addition, he finds that the impact of mobility on attitudes towards redistribution depends on individual perceptions of fairness in the mobility process. Where equal opportunities exist, individuals are happy for social mobility to replace redistribution. Yet, if mobility is perceived as biased, unfair and unequal, preferences will tend towards redistribution. * Thus, where the social 'rat race' is fair, everyone has equal opportunities to move up in life. Social mobility can replace government intervention in redistributive matters. * To conclude, social structure and ideology affect individuals' preferences for redistribution. Either through current income, altruism, social justice or mobility, individuals develop attitudes. There exist vast disparities between attitudes in Europe and the USA. Alesina poses that this is predominantly a result of differing perceptions about social mobility. 1 Friedman, M. Capitalism and Freedom. P165. 2 Alesina, A. Inequality and Happiness: Are Europeans and Americans Different?. NBER Working Paper No. W8198. April 2001. 3 Alesina, A. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level European Union section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level European Union essays

  1. EU actorness in relation to Environment policy and Development policy: An evaluation.

    in 1992 humanitarian aid provision has become a large component of development policy. Other opportunities for the EU to act outside of its member states came in the form of partnership conventions: * Yaound´┐Ż convention-This convention combined part four of the EEC Treaty, together with an implementing convention, and governed

  2. Cultural Factors Relating to Fraternities

    This is perceived to many as harmless, but in reality, this form of hazing can lead to serious physical damage and, in the case of Chuck Stephens, even death. Another negative cultural aspect of hazing is psychological torment. Verbal and/or mental abuse also falls into the category of hazing.

  1. British Airways - company structure

    This calls for great formalisation of procedure; and CO-operation with subsidiaries, partners, and other bodies which form its structure. This section; British Airways structure has to do with leadership of this enormous concern. There are three Directors; seven executive directors; there is the leadership team which has to do with

  2. Regulation 2560/2001 on cross-border payments in Europe.

    Costs also differ with each transaction partner. Unfortunately, no usage statistics are available for TIPANET. As far back as 1989, postal and giro banks set up Eurogiro as a means to settle cross-border payments. In July 2002, Eurogiro had 39 members in 37 countries, including some commercial banks.

  1. Effectiveness and Democratic Legitimacy: An Investigation of the European Democratic Deficit

    As a direct result, more government functions have been brought within the exclusive responsibility of the EU, thereby leading to a loss of problem-solving capacities of national political systems. As Weiler argues, "Though the formal political boundaries of the State have remained intact, in the areas of transfer of responsibility

  2. Where Are The Americans?

    If we want to get Americans interested in Kosova, we must speak and publish in the English language in addition to Albanian. Every key speech given; every key event; every meeting attended must be also presented in English. Our daily newspapers should have at least one page in English presenting

  1. The Management of Global Crisis.

    Therefore, "terrorism can be defined as the systematic use of illegitimate violence that is employed by sub-state actors as a means to achieve specific political objectives...it is a psychological tactic that seeks to spread fear-inducing effects in a target group wider than the immediate audience through the actual or feared

  2. Austria - An economic and political overview.

    But this was only benefiting their popularity and in the 1991 provincial elections they had outstanding showings. The FPO gained votes in four consecutive elections increasing it's position in a impressive way. The outcome of the most recent national elections, in October '99, has resulted in a lot of controversy,

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work