Inequality, Protests, and the Progressive Allocation of Cash Transfers in the Argentine Provinces

Abstract

AbstractIn the last 20 years, two broadly defined theories have sought to explain the relationship between economic inequality and redistribution. The well-known hypothesis set forth by Meltzer and Richard (1981) states that larger income differences between the median voter and the average income earner should increase redistributive pressures in democratic regimes. Power Resource Theory (PRT), by contrast, argues that income inequality breeds power inequality and should dampen redistribution. Critical to both theories is the translation of redistributive interest into policy signals. This article considers protests as signals that increase the salience of inequality among voters. Results provide evidence that protests facilitate more progressive cash transfers in highly unequal environments but have modest effects in more egalitarian ones.