What is the Meltzer-Richard model in simple terms?

When the gap between rich and ordinary people grows, the ordinary majority votes to tax and share more, so government grows.

What is the Robin Hood paradox?

In practice, more unequal countries often redistribute less, contrary to the model.

Meltzer-Richard Model

📈 Economics By CampusDown Wiki Editorial Team Last updated October 27, 2026

The Meltzer-Richard model is a political economy model predicting that in democracies, greater income inequality leads to more government redistribution. Allan Meltzer and Scott Richard proposed it in 1981. The lower the median voter's income relative to the mean, the more the median voter gains from taxing and redistributing, and so the higher the tax rate they support.

Contents

1. The model's logic
2. The Robin Hood paradox
3. Institutions and the structure of inequality
4. FAQ
5. References

The model's logic

Meltzer and Richard (1981) assumed a simple scheme in which government taxes everyone at the same rate and gives everyone the same transfer. Those earning below the mean receive more than they pay, but very high tax rates reduce work incentives and total income. When the tax rate is chosen by vote, the rate preferred by the median voter wins, so the lower median income is relative to mean income, the greater inequality, the higher the tax rate and the larger the government. The model builds on Romer (1975) and Roberts (1977) on voting over linear income taxes.

The Robin Hood paradox

Real data often contradict the prediction: the highly unequal United States redistributes little, while more equal Nordic countries redistribute a lot. This is called the 'Robin Hood paradox'. Bénabou and Ok (2001) argued that people who expect their incomes to rise may oppose redistribution even if they are poor now. Moene and Wallerstein (2001) showed that demand for social insurance, unlike pure redistribution, may rise with income. The issue also connects to debates on redistribution and growth.

Institutions and the structure of inequality

Later work focused on institutions and the structure of inequality rather than its level. Iversen and Soskice (2006) showed that proportional representation makes center-left coalitions more likely and redistribution larger. Lupu and Pontusson (2011) found that the middle class supports redistribution when it is closer to the poor. Although its predictions do not always hold, the Meltzer-Richard model remains a basic starting point, with public choice theory, for analyzing redistribution in democracies.

FAQ

What is the Meltzer-Richard model in simple terms?: When the gap between rich and ordinary people grows, the ordinary majority votes to tax and share more, so government grows.
What is the Robin Hood paradox?: In practice, more unequal countries often redistribute less, contrary to the model.

Sources reviewed: 2026-10-26

References

Meltzer, A. H., & Richard, S. F. (1981). A rational theory of the size of government. Journal of Political Economy, 89(5), 914–927. The founding article.
Romer, T. (1975). Individual welfare, majority voting, and the properties of a linear income tax. Journal of Public Economics, 4(2), 163–185. Theoretical precursor.
Roberts, K. W. S. (1977). Voting over income tax schedules. Journal of Public Economics, 8(3), 329–340. Conditions for the median result.
Bénabou, R., & Ok, E. A. (2001). Social mobility and the demand for redistribution: The POUM hypothesis. Quarterly Journal of Economics, 116(2), 447–487. The POUM hypothesis.
Moene, K. O., & Wallerstein, M. (2001). Inequality, social insurance, and redistribution. American Political Science Review, 95(4), 859–874. Social insurance alternative.
Iversen, T., & Soskice, D. (2006). Electoral institutions and the politics of coalitions: Why some democracies redistribute more than others. American Political Science Review, 100(2), 165–181. Electoral institutions matter.
Lupu, N., & Pontusson, J. (2011). The structure of inequality and the politics of redistribution. American Political Science Review, 105(2), 316–336. Structure of inequality matters.

Reports and materials that use this theory (Korean)

There are no materials dedicated to this theory yet, but you can search related reports in the CampusDown library (Korean).

Find more reports · Search '멜처-리처드 모형' on CampusDown →

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This article was last updated on October 27, 2026. It is based on widely recognized original works and textbooks; when citing it in a paper, please check the original sources listed in the references.