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Income mobility prospects affect individuals’ willingness to pay higher taxes, or give part of their income, to improve the public healthcare and public education systems. In line with the prospects of the upward mobility hypothesis, risk-willing individuals who expect to move far up the socio-economic ladder are less willing to pay compared with individuals who expect no upward transition. Consistent with a social insurance effect, risk-averse individuals who hold modest upward prospects are more willing to pay compared with individuals without upward prospects. These findings are based on more than 19,000 observations from the third round of the Life in Transition Survey.
Authors
Rasmus Wiese
Assistant Professor University of Groningen
Steffen Eriksen
Associate Professor University of Groningen
Journal article details
- DOI
- 10.1111/1475-5890.12359
- Publisher
- Institute for Fiscal Studies
- Issue
- Volume 45, Issue 1, pages 55-76
Suggested citation
Eriksen, S and Wiese, R. (2024). 'Willingness to pay for improved public education and public healthcare systems: the role of income mobility prospects' 45(1/), pp.55–76.
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