Risks and Redistribution

Abstract

Much of the disagreement in the debate about globalization and its present or absent effects on the welfare state stems from competing assumptions about the individual-level determinants of redistributional preferences. This article calls for and provides testing of these causal mechanisms at the individual level. Traditional accounts suggest that risks at the industry level are important determinants of redistributional preferences. This article argues that risks at the occupational level should also be considered. A comprehensive new data set is used to test whether and what types of risks in the labor market play an important role in shaping preferences. Statistical analyses of public opinion surveys (European Social Survey) show strong evidence for the assumed causal mechanism. Contrary to much of the literature, but in line with this article's claims, it is the occupational, rather than the industry level, that is most important. The article lays out implications of these findings.