A cross-country experimental comparison of preferences for redistribution

Francesco Farina and Gianluca Grimalda

Department of Economic Policy, Finance and Development (DEPFID) University of Siena from Department of Economic Policy, Finance and Development (DEPFID), University of Siena

Abstract: We examine experimentally individual preferences for redistributions in the US, Italy, and Norway. We decompose demand for redistribution due to luck vis-à-vis individual merit, and study how they are affected by individual and social characteristics. Experimental subjects made four different decisions on how much earning redistribution they wanted to implement in their group starting from a given initial distribution of earnings. The first decision measured preferences for inequality under a condition of impersonality. The second and third decisions were made behind a “veil of ignorance”, whereas the fourth decision was taken knowing one’s position in the earnings scale. Ambiguity and risk aversions were measured in an independent set of decisions. Between-country differences are sizable. Norwegian subjects were generally the most redistributive of the three, and the US subjects the least redistributive. Italian subjects seemed more willing to accept inequality differences due to individual merit than others. Conversely, Norwegian subjects demanded high levels of redistribution regardless of how inequality had been generated. Experimental redistribution is significantly higher in Norway than Italy, in spite of the two samples holding comparable views over social mobility. This calls for a re-examination of existing theories that see beliefs on mobility as the main explanation of demand for redistribution.

Keywords: Inequality; redistribution; individual merit; cross-country experiments. (search for similar items in EconPapers)
JEL-codes: C91 D31 D63 P52 (search for similar items in EconPapers)
Date: 2011-02
New Economics Papers: this item is included in nep-eur, nep-evo, nep-exp and nep-ltv
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:usi:depfid:0211

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