Voter Ideology, Economic Factors, and State and Local Tax Progressivity

Abstract

This study examines the relationship between voter ideology and the distribution of tax burdens across income groups using state and local data, aggregated at the state level, for 1995, 2002, and 2007. I find that average voter liberalism is positively related to subnational tax progressivity. However, the effects are economically insignificant. A state’s ethnic demographic context appears to be more important. The ethnic congruence between the poor and the nonpoor is positively related to progressivity and the effects are economically significant. The tension between ethnic groups, measured with an index of residential segregation, is inversely related to progressivity. The effects are larger in magnitude than those of average voter liberalism. It is possible that the ethnic demographic context reflects aspects of voter preferences that are not captured by measures of voter ideology.