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In the early 1980s, facing the financial crises in their public pension systems, the governments of both the United States and Japan proposed reform. In each case the reform efforts failed. A few years later policy proposals by special commissions led to the enactment of reform legislation in both countries. No major political upheavals occurred in the intervening years; but in both cases, failure turned into success in a short period. The article demonstrates that similar shifts in political strategy (the use of special commissions) produced parallel outcomes (the benefits cut reforms). This study points to the universal components of political strategy in democratic systems at the same time as it emphasizes the distinctive feature of the American and Japanese political systems.

Focuses on the results of changes in political strategy during the 1980s.

Social insurance motivations consider the welfare of others who are in potentially unfavorable situations. However, their role in increasing support for redistribution is not yet fully understood. The experiment reported here examined distributional decisions in which participants determined income distribution without being informed to which income class they would belong. This was contrasted with decisions made in lottery situations. Lottery decisions had the same risk for oneself, but they lacked a social context, namely the influence on the incomes of others. Less risky (more equal) decisions were observed in distributional decisions than in lottery decisions. Further, the selection of equality in distributional decisions (but not the risk aversion observed in lottery decisions) was positively correlated with support for welfare policies, which had been measured by a pre-experiment survey. This study observed the critical role of social context, which promotes the consideration of the welfare of others in fostering support for redistribution.

AbstractState revenue production since the third wave of democratization contrasts sharply with the experiences of the first and second waves of democratization. The late democratizers tend to adopt and raise revenue from a regressive tax on consumption (the value-added tax: VAT), which is more compatible with economic development in global markets but is considered as unequal taxation. How does the weak redistributive (i.e., regressive) effect of this form of taxation affect the welfare of people? We build on the conventional wisdom that democratic accountability through multiparty contestation improves human development. Focused on taxation, we argue that an increasing statefinancialcapacity contributes to an increase in human development, even when electoral contestation is absent. Empirical analyses employed a reduction in infant mortality as an indicator for the improvement of human development and demonstrate the counter-intuitive effect of the VAT on human development. Despite the effect of weak redistribution, the VAT contributes to human development in countries with less democratic accountability. The results also show that the state's financial capacity to secure tax compliance, rather than a mere increase in tax revenue, intervenes critically in such development in countries since the third wave. We conclude that the increased state financial capacity with regressive taxation is expected to promote human development in newly emerging democratic states.

AbstractTaxation is a critical part of state power and has evolved with modernization. Although tax systems are expected to converge as countries achieve economic development, there are variations in the scale and structure of tax revenues. A recurring question is which tax dominates state financing in democracies. Some scholars associate mature democracies with progressive income taxation, and others find that democracies have relied on regressive taxation on consumption. Learning from the history of tax development, this paper illuminates that countries in different democratic waves followed divergent paths of tax development in the process of modernization. The first and second wave democratizers established progressive income taxation in the nineteenth and early twentieth centuries and continued to rely on it. On the other hand, newly democratized countries came to rely heavily on the value-added tax, which was innovated in the mid-twentieth century, shortly before the beginning of the third wave of democratization. By shedding new light on the linkage between the development of modern taxation and the waves of democratization, the study demonstrates that the trajectory of modernization has shaped different tax systems.

AbstractEchoing the call for 'no taxation without representation', the development of modern taxation went hand‐in‐hand with Western democratisation. However, taxation appears to have lost its role in the third wave of democratisation. Unlike early democratisers, contemporary autocracies tend to introduce a ready‐made modern taxation system before democratisation. With advice from international organisations, the value added tax (VAT), which mature democracies innovated, has been adopted for economic adjustment and development in globalised markets. Despite these divergences, it is argued in this article that a fundamental relationship between taxation and representation remains. Taxation inherently involves a social contract between revenue‐seeking rulers and citizens, and thus involves their bargaining over representation. Therefore, the production of state revenue intervenes in contemporary democratisation as well. By factoring in the effect of the VAT in 143 developing countries between 1960 and 2007, an entropy‐balancing analysis has confirmed its important role in contemporary democratisation. The taxation‐democratisation linkage has travelled from early to contemporary democratisation.