Why Some Want Something for Nothing: Three Explanations for Unfunded Spending Demand

Abstract:

Several studies have documented ‘something for nothing’ (SFN) attitudes among citizens: preferences for increased government spending and lower taxes. Such a demand for unfunded public spending may generate unsustainable fiscal pressures. However, it is unclear what causes SFN attitudes at the individual level. While previous research emphasizes the role of political information, we explore how SFN attitudes also represent a rational response to economic vulnerability and service dissatisfaction. Using an original survey in Norway, we find that economic vulnerability is a pivotal explanation of SFN attitudes: lower income and education, being a benefit recipient, and perceived economic risks drive demand for welfare state support but dampen support for taxation. We also observe that political information and service satisfaction partially alleviate SFN attitudes by increasing taxation support more than spending demand. Understanding these drivers for unfunded public spending has implications for the sustainability of the welfare state.