Deservingness of the Rich, Wealth Taxation, and the Paradox of Inheritance

Sharon Baute, Luna Bellani () and Katharina Hecht ()
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Sharon Baute: University of Konstanz
Luna Bellani: Ulm University
Katharina Hecht: Northeastern University

No 18043, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Wealth is increasingly unequally distributed in many countries. This study examines public perceptions of wealth deservingness and preferences for taxing the wealth of the rich, focusing on how opinions vary based on the amount, use, and origin of wealth. Drawing on an original vignette experiment conducted in Germany (n=6,018), our results show a consistent pattern: as wealth increases, its perceived deservingness declines, while support for taxation rises. Similarly, spending on luxury items is seen as less deserving than philanthropic or nonprofit investments, leading to greater support for taxing the wealth of luxury spending rich people. However, wealth obtained through inheritance presents a puzzling exception: although it is perceived as the least deserving compared to wealth gained through entrepreneurship or management, this does not translate into a stronger preference for taxing inheritors over managers. These findings, which hold across different income and wealth groups as well as political affiliations, highlight the complex and sometimes contradictory public attitudes toward the rich and the taxation of their wealth.

Keywords: survey experiment; richness; redistribution; inequality; wealth taxation (search for similar items in EconPapers)
JEL-codes: D3 D6 H2 (search for similar items in EconPapers)
Date: 2025-07
New Economics Papers: this item is included in nep-exp and nep-pbe
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