Abstract
<em>This study examines the effectiveness of redistribution policies considering balance of payments. Unlike </em><em>Bowles (2012) and Abe (2015, 2016), we assume that capital movement is sluggish to consider the </em><em>short-run effects. Results indicate that conventional egalitarian policies such as increasing </em><em>unemployment compensation and strengthening dismissal regulations can be effective, whereas an </em><em>asset-based redistribution such as a decrease in the ratio of monitoring labor cannot be. These results </em><em>contradict Bowles (2012). We need to reevaluate conventional egalitarian policies if the effects of </em><em>effective demand and adjustment of capital continue in the long run.</em>
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