We develop a political economy model of income taxation and public spending, in which we pay special attention to the composition of the latter. The significant economic unit is taken to be the household. Each household is made of two agents, positively sorted by wage, who engage in the...

Korpi and Palme (1998) famously suggested the existence of a Paradox of Redistribution:although programs targeted to the poor may be more redistributive per unit of expendi-ture, universal programs reduce distributive conflicts, leading to bigger, more egalitarian wel-fare states. However,...