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

Author

Listed:
  • Strehl-Pessina, Matías

    (University of California, Santa Barbara)

  • Bergolo, Marcelo

    (IECON, Universidad de la República)

  • Leites, Martin

    (Universidad de la República, Uruguay)

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 that combines 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. Comparing this group with the Top 50-2%, we show that differences in support for redistribution are not solely explained by current 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 otherhigh-incomegroups. 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

  • Strehl-Pessina, Matías & Bergolo, Marcelo & Leites, Martin, 2025. "Beyond Income: Understanding Preferences for Redistribution Among the Top 1%," IZA Discussion Papers 18057, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp18057
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    References listed on IDEAS

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    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.
    2. Keefer, Philip & Scartascini, Carlos & Vlaicu, Razvan, 2022. "Demand-side determinants of public spending allocations: Voter trust, risk and time preferences," Journal of Public Economics, Elsevier, vol. 206(C).
    Full references (including those not matched with items on IDEAS)

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    Keywords

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    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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