Advanced Search
MyIDEAS: Login

In the Eye of the Beholder: Subjective Inequality Measures and the Demand for Redistribution

Contents:

Author Info

Registered author(s):

    Abstract

    This paper presents a simple conceptual framework intended for describing individuals’ subjective evaluations of occupational wage inequality and their demand for redistribution. Most importantly, the framework explicitly allows for the distinction between individuals’ perceptions and their normative beliefs. I illustrate the framework using Swiss survey data from the International Social Survey Program. While most individuals accept quite large wage differentials across occupations, they also prefer a lower level of overall wage inequality than what they perceive to exist. Consistent with previous evidence, the empirical analysis also shows that financial self-interest, social norms about distributive justice and perceptions of how wages are determined in reality all simultaneously influence the demand for redistribution. Finally, I show that subjective inequality measures and the demand for redistribution are substantially significant predictors of both individuals’ support for government intervention and their party identification. This result provides indirect evidence on the presumed link between perceptions and beliefs on the one hand and political outcomes on the other hand.

    Download Info

    If 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.
    File URL: http://www.labornrn.at/wp/wp0914.pdf
    Download Restriction: no

    Bibliographic Info

    Paper provided by The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria in its series NRN working papers with number 2009-14.

    as in new window
    Length: 60 pages
    Date of creation: Aug 2009
    Date of revision:
    Handle: RePEc:jku:nrnwps:2009_14

    Contact details of provider:
    Postal: NRN Labor Economics and the Welfare State, c/o Rudolf Winter-Ebmer, Altenbergerstr. 69, 4040 Linz
    Phone: +43-732-2468-8216
    Fax: +43-732-2468-8217
    Email:
    Web page: http://www.labornrn.at/
    More information through EDIRC

    Related research

    Keywords: Subjective inequality measures; demand for redistribution; distributive justice; party identification; support for the welfare state;

    Find related papers by JEL classification:

    This paper has been announced in the following NEP Reports:

    References

    References listed on IDEAS
    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.:
    as in new window
    1. Alberto Alesina & Rafael Di Tella & Robert MacCulloch, 2001. "Inequality and Happiness: Are Europeans and Americans Different?," Harvard Institute of Economic Research Working Papers 1938, Harvard - Institute of Economic Research.
    2. Andrew E. Clark and Andrew J. Oswald, . "Satisfaction and Comparison Income," Economics Discussion Papers 419, University of Essex, Department of Economics.
    3. Feld, Lars P. & Matsusaka, John G., 2003. "Budget referendums and government spending: evidence from Swiss cantons," Journal of Public Economics, Elsevier, vol. 87(12), pages 2703-2724, December.
    4. Christina M. Fong & Samuel Bowles & Herbert Gintis, 2005. "Behavioural Motives for Income Redistribution," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 38(3), pages 285-297, 09.
    5. Piketty, Thomas, 1995. "Social Mobility and Redistributive Politics," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 551-84, August.
    6. Fong, Christina, 2001. "Social preferences, self-interest, and the demand for redistribution," Journal of Public Economics, Elsevier, vol. 82(2), pages 225-246, November.
    7. Ran Abramitzky, 2008. "The Limits of Equality: Insights from the Israeli Kibbutz," Discussion Papers 07-048, Stanford Institute for Economic Policy Research.
    8. Rafael Di Tella & Robert MacCulloch, 2004. "Unemployment Benefits as a Substitute for a Conservative Central Banker," The Review of Economics and Statistics, MIT Press, vol. 86(4), pages 911-922, November.
    9. Sen, Amartya, 2000. "Social justice and the distribution of income," Handbook of Income Distribution, in: A.B. Atkinson & F. Bourguignon (ed.), Handbook of Income Distribution, edition 1, volume 1, chapter 1, pages 59-85 Elsevier.
    10. DiTella, Rafael & MacCulloch, Robert, 2001. "The determination of unemployment benefits," ZEI Working Papers B 04-2001, ZEI - Center for European Integration Studies, University of Bonn.
    11. Alberto F. Alesina & Paola Giuliano, 2009. "Preferences for Redistribution," NBER Working Papers 14825, National Bureau of Economic Research, Inc.
    12. Kakwani, N C & Podder, N, 1973. "On the Estimation of Lorenz Curves from Grouped Observations," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 14(2), pages 278-92, June.
    13. Bernard M.S. van Praag & P. Frijters & A. Ferrer-i-Carbonell, 2002. "The Anatomy of Subjective Well-being," Tinbergen Institute Discussion Papers 02-022/3, Tinbergen Institute.
    14. Andrew Clark, 2001. "Unemployment As A Social Norm: Psychological Evidence from Panel Data," DELTA Working Papers 2001-17, DELTA (Ecole normale supérieure).
    15. Rainald Borck, 2007. "Voting, Inequality And Redistribution," Journal of Economic Surveys, Wiley Blackwell, vol. 21(1), pages 90-109, 02.
    16. Alberto Alesina & George-Marios Angeletos, 2004. "Fairness and Redistribution," NajEcon Working Paper Reviews 122247000000000306, www.najecon.org.
    17. Stutzer, Alois & Lalive, Rafael, 2001. "The Role of Social Work Norms in Job Searching and Subjective Well-Being," IZA Discussion Papers 300, Institute for the Study of Labor (IZA).
    18. James Konow, 2003. "Which Is the Fairest One of All? A Positive Analysis of Justice Theories," Journal of Economic Literature, American Economic Association, vol. 41(4), pages 1188-1239, December.
    19. Cowell, F.A., 2000. "Measurement of inequality," Handbook of Income Distribution, in: A.B. Atkinson & F. Bourguignon (ed.), Handbook of Income Distribution, edition 1, volume 1, chapter 2, pages 87-166 Elsevier.
    20. Xander Koolman & Eddy van Doorslaer, 2004. "On the interpretation of a concentration index of inequality," Health Economics, John Wiley & Sons, Ltd., vol. 13(7), pages 649-656.
    21. Roemer, John E., 1998. "Why the poor do not expropriate the rich: an old argument in new garb," Journal of Public Economics, Elsevier, vol. 70(3), pages 399-424, December.
    22. Alesina, Alberto F & La Ferrara, Eliana, 2002. "Preferences for Redistribution in the Land of Opportunities," CEPR Discussion Papers 3155, C.E.P.R. Discussion Papers.
    23. Ran Abramitzky, 2008. "The Limits of Equality: Insights from the Israeli Kibbutz," The Quarterly Journal of Economics, MIT Press, vol. 123(3), pages 1111-1159, August.
    24. Feld, Lars P. & Kirchgassner, Gebhard, 2000. "Direct democracy, political culture, and the outcome of economic policy: a report on the Swiss experience," European Journal of Political Economy, Elsevier, vol. 16(2), pages 287-306, June.
    25. Di Tella, Rafael & Galiani, Sebastian & Schargrodsky, Ernesto, 2012. "Reality versus propaganda in the formation of beliefs about privatization," Journal of Public Economics, Elsevier, vol. 96(5), pages 553-567.
    26. Blackburn, McKinley L., 1989. "Interpreting the magnitude of changes in measures of income inequality," Journal of Econometrics, Elsevier, vol. 42(1), pages 21-25, September.
    27. Rafael Di Tella & Sebastian Galiani & Ernesto Schargrodsky, 2007. "The Formation of Beliefs: Evidence from the Allocation of Land Titles to Squatters," The Quarterly Journal of Economics, MIT Press, vol. 122(1), pages 209-241, 02.
    28. La Ferrara, Eliana & Alesina, Alberto, 2005. "Preferences for Redistribution in the Land of Opportunities," Scholarly Articles 4552533, Harvard University Department of Economics.
    29. Meltzer, Allan H & Richard, Scott F, 1981. "A Rational Theory of the Size of Government," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 914-27, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:jku:nrnwps:2009_14. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ren� B�heim).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.