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Leaky Bucket in the Real World: Estimating Inequality Aversion Using Survey Data

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  • Jukka Pirttilä
  • Roope Uusitalo

Abstract

Existing evidence of inequality aversion relies on data from class-room experiments where subjects face hypothetical questions. This paper estimates the magnitude of inequality aversion using repre-sentative survey data, with questions related to the real-economy situations the respondents face. The results reveal that the magnitude of inequality aversion can be measured in a meaningful way using survey data, but the estimates depend dramatically on the framing of the question. No matter how measured, the revealed inequality aversion predicts opinions on a wide range of questions re-lated to the welfare state, such as the level of taxation, tax progressivity and the structure of unem-ployment benefits.

Suggested Citation

  • Jukka Pirttilä & Roope Uusitalo, 2007. "Leaky Bucket in the Real World: Estimating Inequality Aversion Using Survey Data," Working Papers 231, Työn ja talouden tutkimus LABORE, The Labour Institute for Economic Research LABORE.
    • Handle: RePEc:pst:wpaper:231
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    More about this item

    Keywords

    inequality aversion; social welfare functions; welfare state;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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