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Unfair Inequality and the Demand for Redistribution

Leo Ahrens ()

No 771, LIS Working papers from LIS Cross-National Data Center in Luxembourg

Abstract: What is the relationship between income inequality and individuals’ demand for redistribution? Recent research focuses on distributive justice perceptions to explain the relationship. However, one of the most supported justice principles, namely equity, has received too little attention. Equity posits that incomes should be distributed according to individual merit, implying that resulting inequalities are viewed as fair. This article’s central claim is that it is primarily inequality viewed as unfair which leads to inequality aversion and thus stronger redistribution preferences. The argument is substantiated with an empirical quantification of an unfairness Gini that measures whether individuals have unequal returns to their labor-related merits. Multilevel models using repeated cross-sections show that it can explain both withinand between-country variance in redistribution preferences and that it is a better predictor than commonly used Gini indices. The results suggest that public opinion cannot be inferred directly from the overall level of inequality.

Pages: 23 pages
Date: 2020-03
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