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Beyond Income: Understanding Preferences for Redistribution Among the Top 1%

Author

Listed:
  • Matías Strehl Pessina

    (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía)

  • Marcelo Bérgolo

    (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía)

  • Martín Leites

    (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía)

Abstract

Do top-income individuals support different levels of redistribution compared to the rest of society? If so, what drives these differences? We address these questions using a novel dataset combining administrative tax records with unique survey data on the social and economic preferences of workers in Uruguay. We document a marked decline in support for redistribution among the Top 1% of the income distribution. By comparing this group to the Top 50-2%, we show that differences in redistribution support are not solely explained by income or demographics. A set of beliefs, perceptions, and views, including political ideology, meritocratic beliefs, and views on government, account for much of the observed differences. Instead, a set of behavioral traits and social preferences, such as altruism and risk aversion, measured through incentivized online games, contribute little to explaining the gap. Finally, the differences in support for redistribution persist even when comparing the Top 1% with other high-income groups. Together, these findings suggest that the Top 1% is a distinct group with preferences for redistribution that differ from the rest of society, even from other high-income groups

Suggested Citation

  • Matías Strehl Pessina & Marcelo Bérgolo & Martín Leites, 2024. "Beyond Income: Understanding Preferences for Redistribution Among the Top 1%," Documentos de Trabajo (working papers) 24-13, Instituto de Economía - IECON.
    • Handle: RePEc:ulr:wpaper:dt-13-24
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    File URL: https://hdl.handle.net/20.500.12008/46538
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    References listed on IDEAS

    as
    1. Kristoffer B Hvidberg & Claus T Kreiner & Stefanie Stantcheva, 2023. "Social Positions and Fairness Views on Inequality," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 90(6), pages 3083-3118.
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    More about this item

    Keywords

    Top-income individuals; Perceptions; Behavioral traits; Preferences for redistribution; Beliefs; Social preferences;
    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
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General

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