• 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. Explain how groupthink and groupshift affect group decision-making with reference to contemporary management research

    Group discussion tends to exaggerate the initial position of the group. For example conservative groups become more cautious and more aggressive groups take greater risks. The most plausible explanation is that the group diffuses responsibility. This allows individuals greater freedom to take risks since no individual is wholly accountable.

  2. Transformation of the U.S. Hegemony in Europe through NATO after the Cold War

    For the U.S. policy makers, European Union would play the role of a vigorous ally and a strategic partner, by obtaining its own strong mind (political unity) and capacity to act (burden sharing), however usage of this capacity was desired through alliance system (prevention of the duplication).

  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

    One problem with psychological abuse is that it is often perceived to be harmless. This form of abuse is viewed as an initiation ceremony designed to determine one's worthiness as a prospective "brother" (Curry 95). Most existing fraternity members and the new members feel that the hazing process creates a bond between the two.

  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.

    Contrary to TARGET and TIPANET, all transactions are settled through one bank, Postgirot Bank of Sweden. Therefore, Eurogiro reaches a high degree of automation ('straight through processing'). Although the larger part of transactions that Eurogiro handles are low-value, the system can also be used for large-value transactions.

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

    This remoteness, coupled with the convoluted process of policy formation in the EU, results in a general lack of transparency. "Decision-making at the European level is all too often an opaque and confusing process which even experts struggle to comprehend and which leads to a situation where it is easy

  2. Where Are The Americans?

    all the headlines and a brief about the story, and our television news and key presentations must also be done in English. If we want people to listen to us, then we better speak their language! Our periodicals should contain English features, and every major press release by any organization of influence should be prepared in good English.

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