The main activity of a Welfare State is to impose taxes in order to collect money to provide services. In this paper, we want to test subjects' perception of these two issues in the laboratory. In particular, using a real-effort experiment as a tool, we aim at measuring both the labor supply and the consensus as the level of taxation and the efficiency of the Welfare State vary. Our finding is that subjects significantly react to a change in the tax rate, while the performance of the Welfare State affects subjects' preferences but not their labor supply. © 2011 Springer-Verlag.
Ottone, S., Ponzano, F. (2011). How People perceive the Welfare State. A real–effort experiment. INTERNATIONAL REVIEW OF ECONOMICS, 58(2), 165-183 [10.1007/s12232-011-0123-z].
How People perceive the Welfare State. A real–effort experiment
OTTONE, STEFANIA;
2011
Abstract
The main activity of a Welfare State is to impose taxes in order to collect money to provide services. In this paper, we want to test subjects' perception of these two issues in the laboratory. In particular, using a real-effort experiment as a tool, we aim at measuring both the labor supply and the consensus as the level of taxation and the efficiency of the Welfare State vary. Our finding is that subjects significantly react to a change in the tax rate, while the performance of the Welfare State affects subjects' preferences but not their labor supply. © 2011 Springer-Verlag.
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