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Other-Regarding Preferences and Redistributive Politics

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  • Fehr, Ernst

    (University of Zurich)

  • Epper, Thomas

    (CNRS)

  • Senn, Julien

    (University of Zurich)

Abstract

Increasing inequality and associated egalitarian sentiments have again put redistribution on the political agenda. Other-regarding preferences may also affect support for redistribution, but knowledge about their distribution in the broader population and how they are associated with political support for redistributive policies is still scarce. 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 other-regarding preferences and support for redistribution in a broad sample of the Swiss population. We document that inequality aversion and altruistic concerns play a quantitatively large positive role in the support for redistribution, in particular for more affluent individuals. In addition, 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 altruistic and egalitarian individuals. Finally, while inequality averse individuals display strong support for policies that primarily aim at reducing the incomes of the rich, altruistic individuals are considerably less supportive of such policies. Thus, knowledge about the fundamental properties and the distribution of individuals' other-regarding preferences also provides a deeper understanding about who is likely to support specific redistributive policies.

Suggested Citation

  • Fehr, Ernst & Epper, Thomas & Senn, Julien, 2022. "Other-Regarding Preferences and Redistributive Politics," IZA Discussion Papers 15088, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp15088
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    1. Other-Regarding Preferences and Redistributive Politics
      by maximorossi in NEP-LTV blog on 2022-03-16 09:55:15

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    3. Bérgolo, Marcelo & Burdin, Gabriel & Burone, Santiago & De Rosa, Mauricio & Giaccobasso, Matias & Leites, Martin, 2022. "Dissecting inequality-averse preferences," Journal of Economic Behavior & Organization, Elsevier, vol. 200(C), pages 782-802.
    4. Sandro Ambuehl & B. Douglas Bernheim, 2021. "Interpreting the will of the people: social preferences over ordinal outcomes," ECON - Working Papers 395, Department of Economics - University of Zurich, revised Jan 2024.
    5. Sandro Ambuehl & B. Douglas Bernheim, 2021. "Interpreting the Will of the People: A Positive Analysis of Ordinal Preference Aggregation," NBER Working Papers 29389, National Bureau of Economic Research, Inc.
    6. Falch, Ranveig, 2022. "How do people trade off resources between quick and slow learners?," European Economic Review, Elsevier, vol. 150(C).
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    More about this item

    Keywords

    social preferences; altruism; inequality aversion; preference heterogeneity; demand for redistribution;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies

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