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Do You Prefer Having Much More or Slightly More than Others?

Author

Listed:
  • Sharon Hadad

    (Sapir Academic College)

  • Miki Malul

    (Ben-Gurion University of the Negev)

Abstract

Several studies found that people have a positive utility when they have more than others do. These papers claim that individuals are willing to sacrifice part of their absolute income or products in order to have more than others. As far as we know, the current paper is the first to show that positionality is bounded, so that individuals enjoy having more than others only when the gap between them and the others is not too large. Using the results from a survey-based experiment conducted in Israel that included 924 participants, we show that when individuals were asked to forgive some of their income in order to have a higher income compared to others, most of them chose to forgive their absolute income in order to have more than others. However, when individuals were asked to forgive the same amount of income in order to a have a much higher income compared to others, the attractiveness of having more than others significantly decreased. These results may indicate that individuals suffer from a disutility when extreme gaps exist in society, even if they are the ones with the high income.

Suggested Citation

  • Sharon Hadad & Miki Malul, 2017. "Do You Prefer Having Much More or Slightly More than Others?," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 133(1), pages 227-234, August.
    • Handle: RePEc:spr:soinre:v:133:y:2017:i:1:d:10.1007_s11205-016-1362-x
    DOI: 10.1007/s11205-016-1362-x
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    References listed on IDEAS

    as
    1. Neumark, David & Postlewaite, Andrew, 1998. "Relative income concerns and the rise in married women's employment," Journal of Public Economics, Elsevier, vol. 70(1), pages 157-183, October.
    2. Murat Birdal & T. Ongan, 2016. "Why Do We Care About Having More than Others? Socioeconomic Determinants of Positional Concerns in Different Domains," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 126(2), pages 727-738, March.
    3. Paolo Verme, 2011. "Life Satisfaction And Income Inequality," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 57(1), pages 111-127, March.
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    More about this item

    Keywords

    Absolute income; Relative income; Positionality; Inequality;
    All these keywords.

    JEL classification:

    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • Z2 - Other Special Topics - - Sports Economics
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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