Abstract

Political reforms are often held up by concentrated interest groups who successfully lobby to block change that would benefit the majority. One policy response is to fully compensate the recalcitrant group in exchange for agreeing to the reform. We refer to such mass compensation schemes, financed by borrowing against future savings generated by the reform, as buyouts. We design a series of survey experiments to gauge the level and determinants of public support for buyouts across three policy domains: tax simplification, coal energy phase-outs, and amnesty programs. We find that attitudes co-vary across these different issue-areas. Yet buyouts are interpreted primarily as redistribution schemes, rather than means of attaining welfare increases. Accordingly, individual attitudes align on ideological priors tied to redistribution, rather than economic efficiency. Buyouts also find more favor when they target individual workers rather than companies. On the other hand, respondents primed to think about moral hazard, a salient potential concern raised by buyouts, do not consistently oppose them at higher rates. In sum, our results show how crucial program design is in gaining support for public buyouts. In select cases, these may be viable means of pushing through welfare-enhancing reforms that have been blocked for decades.