Rank reversal aversion inhibits redistribution across societies

Wenwen Xie, Benjamin Ho, Stephan Meier and Xinyue Zhou ()
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Wenwen Xie: School of Management, Zhejiang University
Stephan Meier: Graduate School of Business, Columbia University
Xinyue Zhou: School of Management, Zhejiang University

Nature Human Behaviour, 2017, vol. 1, issue 8, 1-5

Abstract: Abstract Income inequality is pervasive despite evidence of inequality-averse social preferences. We show that people will sometimes support inequality to avoid reversing the rank of others in society. Using a third-party dictator game that we call the redistribution game, we found that people sometimes choose more unequal outcomes to preserve existing hierarchies. When a proposed transfer reversed pre-existing income rankings, adults across cultures were twice as likely to reject the transfer. Running the same experimental game in a society of nomadic Tibetan herders with a low level of market integration1, we observed an exceptionally high aversion to rank reversals. In children, we found that inequality aversion develops between the ages of four and five, as shown in previous studies2,3, whereas rank reversal aversion develops between the ages of six and seven. Just as some animal species develop stable pecking orders to reduce in-group violence, human aversion to reversing rank is observed at an early age and across cultures.

Date: 2017
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DOI: 10.1038/s41562-017-0142

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