The Political Economics of Redistributive Policies

Why do countries with similar economic conditions adopt very different redistributive policies? This course examines how political processes shape economic policy, with a particular focus on redistribution. Its aim is to understand how individual preferences, political institutions, and strategic interactions jointly determine policy outcomes.

The course introduces key theoretical and empirical approaches in political economy. Starting from the foundations of collective decision-making, it covers models of voting behavior and political participation, electoral competition between parties, and the role of interest groups and political incentives. Building on these foundations, the course applies these tools to major policy areas such as pensions, labor markets, and climate policy, highlighting real-world conflicts over redistribution.

A central focus of the course is to explain why political outcomes often diverge from economically efficient solutions. To this end, it explores the role of information and misperceptions, fairness considerations, institutional design, and incentive problems in politics.

Students will learn how to apply core political economy models, critically assess empirical evidence, and analyze political decision-making processes in the context of redistribution. Combining analytical tools with real-world applications, the course is designed for students interested in the intersection of economics and politics. The knowledge gained is relevant both for academic careers and for professional paths in policy-making, international organizations, government institutions, or NGOs.

The course is based on the following key works, which provide the theoretical and institutional foundations for the political economy of redistributive policies:

• Galasso, V. (2020): Political Economics: Redistributive Policies. Egea.

• Mueller, D. C. (2003): Public Choice III. Cambridge University Press.

• Persson, T. & Tabellini, G. (2002): Political Economics: Explaining Economic Policy. The MIT Press.

• Congleton, R. D., Grofman, B. & Voigt, S. (eds., 2019): The Oxford Handbook of Public Choice, Vol. 2. Oxford University Press.

In addition, selected peer-reviewed articles from leading international journals will be used to discuss recent empirical findings and ongoing theoretical debates.

• The course usually takes place every summer semester.
• Further information and all relevant documents can be found on the Moodle course page.
• Enrolment for the Moodle course is open (no enrolment key).
• Language of instruction: English