Budget deficits and redistributive politics

This paper proposes a new view of the forces in the political process that cause governments to accumulate debt. The analysis builds on a model of red istributive politics that, contrary to median voter models, does not restri ct the set of policies that politicians can propose. I show that deficits o ccur even in an environment where voters land periods) are homogeneous. Thi s is an environment where previous political theories of debt would predict budget balance. In the model deficits are a way for candidates to better t arget promises to voters and are therefore used as tools of redistributive politics. The main contribution of the analysis is to show that the same fo rces that push candidates to redistribute resources across voters to pursue political advantage are forces that generate budget deficits.