Are People Inequality Averse, and Do They Prefer Redistribution by the State? A Revised Version

Johannes Schwarze and Marco Härpfer ()
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Johannes Schwarze: University of Bamberg
Marco Härpfer: University of Oldenburg

No 974, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We link life-satisfaction data to inequality of the pre- and post-government income distribution at the regional level, to estimate the degree of inequality aversion. Three different inequality measures are used. In addition, we investigate whether a reduction in inequality by the state increases individual well-being. We find only weak evidence that Germans are inequality averse. Inequality reduction by the state does not increase wellbeing. On the contrary, inequality reduction imposes an excess burden on middle-income earners. The paper uses data from the German Socio-economic Panel Study (GSOEP) from 1985 to 1998.

Keywords: life satisfaction; redistribution; inequality aversion; panel data (search for similar items in EconPapers)
JEL-codes: C23 D31 D63 I31 (search for similar items in EconPapers)
Pages: 27 pages
Date: 2003-12
New Economics Papers: this item is included in nep-edu, nep-lab, nep-mic, nep-pol and nep-pub
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Citations: View citations in EconPapers (9)

Published - published in: Journal of Socio-Economics, 2007, 36 (2), 233-249

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