Individual notions of distributive justice and relative economic status
AbstractIssues of inequality, distribution and redistribution are commanding progressively more attention in the minds of not only world leaders, politicians, and academics but also of ordinary people. So, what constitutes distributive justice in the minds of ordinary people? The philosophical literature offers several alternative principles of distributive justice. But which of these, if any, do ordinary people adopt as the principle against which to judge their own and other people's and entities' outcomes and actions? This paper presents the findings from two experiments designed to test the hypothesis that individuals' notions of distributive justice are associated with their economic status relative to others within their own society. In the experiments, each participant played a specially designed distribution game. This game allowed us to establish whether and to what extent the participants perceived inequalities owing to differences in productivity rather than luck as just and, hence, not in need of redress. A type of participant that distinguished between inequalities owing to productivity and luck, redressing the latter and not or to a lesser extent the former, is said to be subject to an earned endowment effect. Drawing on previous work in both economics and psychology, we hypothesised that the richer members of any society would be more likely to be subject to an earned endowment effect, while the poorer members would be more inclined towards redistribution irrespective of whether the inequality was owing to productivity or luck. We conducted our first experiment in the UK. We selected unemployed residents of one city to represent low economic status individuals and student and employed residents of the same city to represent relatively high economic status individuals. We found a statistically significant earned endowment effect among the students and employed and no effect among the unemployed. The difference between the unemployed and the others was also statistically significant. Our second experiment was designed to test the generalizability of the findings from our first. It was conducted in Cape Town, South Africa. Exploiting the fact that Cape Town is home to one of the continent's best universities, we built a participant sample that was highly comparable to the UK sample in many regards. However, the states of employment and unemployment are less distinct in South Africa as compared to the UK and a number of interventions are in place to ensure that the student body of the University of Cape Town includes young people from not only rich and middle income but also poorer households. So, in South Africa we chose to rely on responses to a survey question to distinguish between high and low economic status individuals. The findings from this second experiment also supported the hypothesis; among individuals who classified their households as rich or high or middle income there was a statistically significant earned endowment effect, among individuals who classified their households as poor or low income there was not and the different between the two participant types was significant. We conclude that individuals' notions of distributive justice are associated with their relative economic status within society and that this is a generalizable result.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Institute for Fiscal Studies in its series IFS Working Papers with number W11/19.
Date of creation: Oct 2011
Date of revision:
Contact details of provider:
Postal: The Institute for Fiscal Studies 7 Ridgmount Street LONDON WC1E 7AE
Phone: (+44) 020 7291 4800
Fax: (+44) 020 7323 4780
Web page: http://www.ifs.org.uk
More information through EDIRC
Postal: The Institute for Fiscal Studies 7 Ridgmount Street LONDON WC1E 7AE
Other versions of this item:
- Abigail Barr & Justine Burns & Luis Miller & Ingrid Shaw, 2011. "Individual notions of distributive justice and relative economic status," SALDRU Working Papers 66, Southern Africa Labour and Development Research Unit, University of Cape Town.
- Miller Moya, Luis Miguel & Barr, Abigail & Burns, Justine & Shaw, Ingrid, 2011. "Individual notions of distributive justice and relative economic status," DFAEII Working Papers 2011-03, University of the Basque Country - Department of Foundations of Economic Analysis II.
- Abigail Barr & Justine Burns & Luis Miller & Ingrid Shaw, . "Individual notions of distributive justice and relative economic status," Discussion Papers 11/10, University of Nottingham, School of Economics.
- Abigail Barr & Justine Burns & Luis Miller & Ingrid Shaw, 2011. "Individual notions of distributive justice and relative economic status," Discussion Papers 2011005, University of Oxford, Nuffield College.
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
- C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-11-07 (All new papers)
- NEP-EXP-2011-11-07 (Experimental Economics)
- NEP-HPE-2011-11-07 (History & Philosophy of Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Dearden, Lorraine, et al, 2002.
"The Returns to Academic and Vocational Qualifications in Britain,"
Bulletin of Economic Research,
Wiley Blackwell, vol. 54(3), pages 249-74, July.
- Lorraine Dearden & Steven McIntosh & Michal Myck & Anna Vignoles, 2000. "The Returns to Academic and Vocational Qualifications in Britain," CEE Discussion Papers 0004, Centre for the Economics of Education, LSE.
- Galor, Oded & Zeira, Joseph, 1993. "Income Distribution and Macroeconomics," Review of Economic Studies, Wiley Blackwell, vol. 60(1), pages 35-52, January.
- Luttmer, Erzo F. P. & Singhal, Monica, 2008.
"Culture, Context, and the Taste for Redistribution,"
Working Paper Series
rwp08-038, Harvard University, John F. Kennedy School of Government.
- Erzo F. P. Luttmer & Monica Singhal, 2011. "Culture, Context, and the Taste for Redistribution," American Economic Journal: Economic Policy, American Economic Association, vol. 3(1), pages 157-79, February.
- Erzo F.P. Luttmer & Monica Singhal, 2008. "Culture, Context, and the Taste for Redistribution," NBER Working Papers 14268, National Bureau of Economic Research, Inc.
- Andrew E. Clark, 2003.
"Unemployment as a Social Norm: Psychological Evidence from Panel Data,"
Journal of Labor Economics,
University of Chicago Press, vol. 21(2), pages 289-322, April.
- Andrew Clark, 2001. "Unemployment As A Social Norm: Psychological Evidence from Panel Data," DELTA Working Papers 2001-17, DELTA (Ecole normale supérieure).
- Steven McIntosh, 2004.
"Further Analysis of the Returns to Academic and Vocational Qualifications,"
CEE Discussion Papers
0035, Centre for the Economics of Education, LSE.
- Steven Mcintosh, 2006. "Further Analysis of the Returns to Academic and Vocational Qualifications," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 68(2), pages 225-251, 04.
- Hoffman Elizabeth & McCabe Kevin & Shachat Keith & Smith Vernon, 1994. "Preferences, Property Rights, and Anonymity in Bargaining Games," Games and Economic Behavior, Elsevier, vol. 7(3), pages 346-380, November.
- Alexander W. Cappelen & Astri Drange Hole & Erik Ø Sørensen & Bertil Tungodden, 2007.
"The Pluralism of Fairness Ideals: An Experimental Approach,"
American Economic Review,
American Economic Association, vol. 97(3), pages 818-827, June.
- Alexander W. Cappelen & Astri D. Hole & Erik Ø. Sørensen & Bertil Tungodden, 2005. "The Pluralism of Fairness Ideals: An Experimental Approach," CESifo Working Paper Series 1611, CESifo Group Munich.
- Rutstrom, E. Elisabet & Williams, Melonie B., 2000. "Entitlements and fairness:: an experimental study of distributive preferences," Journal of Economic Behavior & Organization, Elsevier, vol. 43(1), pages 75-89, September.
- Todd L. Cherry & Peter Frykblom & Jason F. Shogren, 2002.
"Hardnose the Dictator,"
American Economic Review,
American Economic Association, vol. 92(4), pages 1218-1221, September.
- Melissa Osborne & Herbert Gintis & Samuel Bowles, 2001. "The Determinants of Earnings: A Behavioral Approach," Journal of Economic Literature, American Economic Association, vol. 39(4), pages 1137-1176, December.
- Pamela Jakiela, 2011. "Social Preferences and Fairness Norms as Informal Institutions: Experimental Evidence," American Economic Review, American Economic Association, vol. 101(3), pages 509-13, May.
- Gantner, Anita & Guth, Werner & Konigstein, Manfred, 2001. "Equitable choices in bargaining games with joint production," Journal of Economic Behavior & Organization, Elsevier, vol. 46(2), pages 209-225, October.
- Cherry, Todd L., 2001. "Mental accounting and other-regarding behavior: Evidence from the lab," Journal of Economic Psychology, Elsevier, vol. 22(5), pages 605-615, October.
- Ruffle, Bradley J., 1998. "More Is Better, But Fair Is Fair: Tipping in Dictator and Ultimatum Games," Games and Economic Behavior, Elsevier, vol. 23(2), pages 247-265, May.
- Oxoby, Robert J. & Spraggon, John, 2008. "Mine and yours: Property rights in dictator games," Journal of Economic Behavior & Organization, Elsevier, vol. 65(3-4), pages 703-713, March.
- James Konow, 2000. "Fair Shares: Accountability and Cognitive Dissonance in Allocation Decisions," American Economic Review, American Economic Association, vol. 90(4), pages 1072-1091, September.
- Haroon Bhorat, 2005. "Poverty, Inequality and Labour Markets in Africa: A Descriptive Overview," Working Papers 05092, University of Cape Town, Development Policy Research Unit.
- Todd L. Cherry & John A. List, 2004.
"Examining the Role of Fairness in High Stakes Allocation Decisions,"
04-01, Department of Economics, Appalachian State University.
- List, John A. & Cherry, Todd L., 2008. "Examining the role of fairness in high stakes allocation decisions," Journal of Economic Behavior & Organization, Elsevier, vol. 65(1), pages 1-8, January.
- Caria, Antonia Stefano & Hassen, Ibrahim Worku, 2013. "The formation of job referral networks: Experimental evidence from ubran Ethiopia:," IFPRI discussion papers 1282, International Food Policy Research Institute (IFPRI).
- Michal Bauer & Julie Chytilová & Barbara Pertold-Gebicka, 2012. "Parental Background and Other-Regarding Preferences in Children," Working Papers IES 2012/10, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised Apr 2012.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Stephanie Seavers).
If references are entirely missing, you can add them using this form.