Fair inequality? Lab evidence from Kenya

Attitudes to inequality differ across countries and contexts, and understanding these differences is important for the design of redistributive policies. We here present evidence on fairness preferences in Kenya, based on a series of lab experiments with participants from Nairobi’s largest informal settlement and its main university. This innovative sample allows us to compare the attitudes and beliefs of two important groups in society: the poor and the educated. We find that while the participants from the informal settlements are more egalitarian than the university students, they are less egalitarian than what is generally perceived. A second important finding is the sharp distinction made between distribution and redistribution, where participants are far more willing to equalize funds with no clear entitlement compared to funds where there is an ex-ante allocation. Finally, many participants view luck as a more deserving source of inequality than performance, an observation that is contrary to what is commonly found in the literature. Our results highlight the complexity of people’s fairness views and show the importance of not relying on stereotypes when designing redistributive policies that harmonize with local norms.