Social Preferences and Redistributive Politics

Ernst Fehr, Thomas Epper () and Julien Senn ()
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Thomas Epper: IESEG School of Management, Univ. Lille, CNRS, UMR 9221- LEM - Lille Economie Management F-59000 Lille, France
Julien Senn: Department of Economics, Zurich University. Blûmlisalpstrasse 10, 8006 Zurich, Switzerland

Working Papers from IESEG School of Management

Abstract: Increasing inequality and associated egalitarian sentiments have put redistribution on the political agenda. In this paper, we take advantage of Swiss direct democracy, where people voted several times on strongly redistributive policies in national plebiscites, to study the link between social preferences and a behaviorally validated measure of support for redistribution in a broad sample of the Swiss population. Using a novel nonparametric Bayesian clustering algorithm, we uncover the existence of three fundamentally distinct preference types in the population: predominantly selfish, inequality averse and altruistic individuals. We show that inequality averse and altruistic individuals display a much stronger support for redistribution, particularly if they are more affluent. In addition, we show that previously identified key motives underlying opposition to redistribution – such as the belief that effort is an important driver of individual success – play no role for selfish individuals but are highly relevant for other-regarding individuals. Finally, while inequality averse individuals display strong support for policies that primarily aim to reduce the incomes of the rich, altruistic individuals are considerably less supportive of these policies. Thus, knowledge about the qualitative properties of social preferences and their distribution in the population also provides insights into which preference type supports specific redistributive policies, which has implications for how policy makers may design redistributive packages to maximize political support for them.

Keywords: Social Preferences; Altruism; Inequality Aversion; Preference Heterogeneity; Demand for Redistribution (search for similar items in EconPapers)
JEL-codes: D31 D72 H23 H24 (search for similar items in EconPapers)
Pages: 75
Date: 2023-10
New Economics Papers: this item is included in nep-cbe, nep-eur, nep-evo, nep-ltv, nep-pol and nep-upt
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Related works:
Working Paper: Social Preferences and Redistributive Politics (2023)
Working Paper: Social preferences and redistributive politics (2023)
Working Paper: Social Preferences and Redistributive Politics (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:ies:wpaper:e202308

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