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employers themselves (Beramendi and Rueda
2010
) is also being explored.
Overall, the analytical approach developed in this study offers an alternative
framework for understanding the long-term relationship between institutions
and social outcomes, and is potentially extendable beyond its empirical realm
of interest.
A third implication of this study concerns the way redistribution operates
and how to conceptualize it. The distinction between interpersonal and inter-
regional as dimensions of redistribution implies that each of these responds to
different political logics. Interregional redistribution occurs when interpersonal
redistribution is partly decentralized and local elites manage to maximize rent
extraction. In turn, interpersonal redistribution is centralized when the will of
local elites is overrun by either massive externalities or the political interests
of their national counterparts. The interplay between geography and repre-
sentation on the one hand, and the levels of mobility on the other, matter to
explain both of them, but the relative importance of each set of factors seems to
differ.
I have provided in depth analyses and econometric results on both of them.
The latter suggests that while the design of interpersonal redistribution is mostly
driven by the interplay between geography and representation, interregional
redistribution responds mostly to the scope of economic externalities created
by large levels of geographical mobility. As a result, the EU has some inter-
regional redistribution and virtually no interpersonal redistribution, whereas
Germany, for instance, seems to score very high on both dimensions. However,
the findings in this topic also suggest that the boundaries between these two
programs are much more blurred than the sharp distinction I have just drawn.
To begin with, the factors that matter overlap: representation is also an
important determinant of the levels of interregional redistribution, as exem-
plified by Germany's experience with Reunification. Mobility can also affect
the incentives to centralize a public insurance program directed to individ-
uals, as exemplified by the analysis of the Canadian response to the Great
Depression. Moreover, in many cases, there is a budgetary link between them:
the incorporation of the East into the German system of social assistance (a sys-
tem of transfers to those most in need) required an increase in the interregional
transfer of resources. The tax-offset system that accompanied the launching of
unemployment insurance in the United States was also a system of interregional
redistribution: those states enacting the program would receive their share of
the employer's tax collected by the federal government. Otherwise, they would
not. To complicate matters further, interpersonal transfers themselves have a
nonneutral incidence across territories, mostly dictated by the regional distri-
bution of actual and/or potential recipients. Thus, an increase in the generosity
of unemployment benefits in Germany for instance, would automatically imply
a flow of resources from East to West.
With these complications in mind, it is hardly surprising that the field treats
redistribution as a black box. By either ignoring the territorial aspects of redis-
tribution altogether (Beramendi and Anderson
2008
; Beramendi and Cusack
