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this question is about voting and redistribution as below: QUESTION 5 Voting and redistribution: (a) Assume that the distribution of personal income is skewed, with

this question is about voting and redistribution as below:

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QUESTION 5 Voting and redistribution: (a) Assume that the distribution of personal income is skewed, with the average level of income, y", exceeding the median income, y". A majority therefore has below-average income. Show formally that, when individuals vote on the rate of income taxation, all tax revenue is to be equally redistributed, and there are no efficiency losses from taxation (there are no incentive effects of taxation and so no excess burden), the median voter will maximize utility by choosing appropriationaxation. How large will the majority in favor of appropriation taxation actually be? (4 points) (b) How do incentive effects of taxation change the self-interested outcome of majority voting on taxation and income redistribution found in part (a)? (2 points) (c) How does social mobility affect incentives to vote for income redistribution? (2 points) (d) How can majority coalitions on voting for income redistribution form without the inclusion of the voter who has the median income in the population? Which particular coalition is suggested by the presence of tax-financed entitlements for the poor? (2 points)

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