Absurdities of the Tiebout model

posted by
December 12, 2012
by Bryan Caplan  
Posted in Commentary

"In a Tiebout world, any social insurance program would have to act like a for-profit insurance company. Rates would match risks, pure and simple. This means that the poor would probably pay not just higher tax rates for welfare or unemployment insurance than Bill Gates; each poor person would probably pay more dollars of taxes for these programs than Bill Gates. After all, what is the probability that Gates will ever go on welfare? One-in-a-billion?" (12/12/12)


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