Inequality Aversion Predicts Support for Public and Private Redistribution

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aut.relation.issue39
aut.relation.journalProceedings of the National Academy of Sciences of the United States of America
aut.relation.startpagee2401445121
aut.relation.volume121
dc.contributor.authorEpper, TF
dc.contributor.authorFehr, E
dc.contributor.authorKreiner, CT
dc.contributor.authorLeth-Petersen, S
dc.contributor.authorOlufsen, IS
dc.contributor.authorSkov, PE
dc.date.accessioned2024-10-06T23:26:59Z
dc.date.available2024-10-06T23:26:59Z
dc.date.issued2024-09-17
dc.description.abstractRising inequality has brought redistribution back on the political agenda. In theory, inequality aversion drives people's support for redistribution. People can dislike both advantageous inequality (comparison relative to those worse off) and disadvantageous inequality (comparison relative to those better off). Existing experimental evidence reveals substantial variation across people in these preferences. However, evidence is scarce on the broader role of these two distinct forms of inequality aversion for redistribution in society. We provide evidence by exploiting a unique combination of data. We use an incentivized experiment to measure inequality aversion in a large population sample (≈9,000 among 20- to 64-y-old Danes). We link the elicited inequality aversion to survey information on individuals' support for public redistribution (policies that reduce income differences) and administrative records revealing their private redistribution (real-life donations to charity). In addition, the link to administrative data enables us to include a large battery of controls in the empirical analysis. Theory predicts that support for public redistribution increases with both types of inequality aversion, while private redistribution should increase with advantageous inequality aversion, but decrease with disadvantageous inequality aversion. A strong dislike for disadvantageous inequality makes people willing to sacrifice own income to reduce the income of people who are better off, thereby reducing the distance to people with more income than themselves. Public redistribution schemes achieve this but private donations to charity do not. Our empirical results provide strong support for these predictions and with quantitatively large effects compared to other predictors.
dc.identifier.citationProceedings of the National Academy of Sciences of the United States of America, ISSN: 1091-6490 (Print); 1091-6490 (Online), Proceedings of the National Academy of Sciences, 121(39), e2401445121-. doi: 10.1073/pnas.2401445121
dc.identifier.doi10.1073/pnas.2401445121
dc.identifier.issn1091-6490
dc.identifier.issn1091-6490
dc.identifier.urihttp://hdl.handle.net/10292/18106
dc.languageeng
dc.publisherProceedings of the National Academy of Sciences
dc.relation.urihttps://www.pnas.org/doi/10.1073/pnas.2401445121
dc.rightsCopyright © 2024 the Author(s). Published by PNAS. This open access article is distributed under Creative Commons Attribution-NonCommercial-NoDerivatives License 4.0 (CC BY-NC-ND).
dc.rights.accessrightsOpenAccess
dc.rights.urihttps://creativecommons.org/licenses/by-nc-nd/4.0/
dc.subjectaltruism
dc.subjectcharitable donation
dc.subjectinequality aversion
dc.subjectredistribution
dc.subjectsocial preferences
dc.subject3801 Applied Economics
dc.subject3803 Economic Theory
dc.subject38 Economics
dc.subject44 Human Society
dc.subject4407 Policy and Administration
dc.subject10 Reduced Inequalities
dc.subject.meshHumans
dc.subject.meshAdult
dc.subject.meshMiddle Aged
dc.subject.meshSocioeconomic Factors
dc.subject.meshMale
dc.subject.meshFemale
dc.subject.meshIncome
dc.subject.meshYoung Adult
dc.subject.meshHumans
dc.subject.meshSocioeconomic Factors
dc.subject.meshAdult
dc.subject.meshMiddle Aged
dc.subject.meshIncome
dc.subject.meshFemale
dc.subject.meshMale
dc.subject.meshYoung Adult
dc.subject.meshHumans
dc.subject.meshAdult
dc.subject.meshMiddle Aged
dc.subject.meshSocioeconomic Factors
dc.subject.meshMale
dc.subject.meshFemale
dc.subject.meshIncome
dc.subject.meshYoung Adult
dc.titleInequality Aversion Predicts Support for Public and Private Redistribution
dc.typeJournal Article
pubs.elements-id569749
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