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Collective negative shocks and preferences for redistribution: Evidence from the COVID-19 crisis in Germany

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  • Bellani, Luna
  • Fazio, Andrea
  • Scervini, Francesco

Abstract

Using new data from a three-wave panel survey administered in Germany between May 2020 and May 2021, this paper studies the impact of a negative shock affecting every strata of the population, such as the development of COVID-19, on preferences for redistribution. Exploiting the plausibly exogenous change in severity of the infection rate at the county level, we show that, contrary to some theoretical expectations, the worse the crisis, the lower the support for redistribution of our respondents. We provide further suggestive evidence that this is not driven by a decrease in inequality aversion, but this might be the result of a decrease in trust in the institutions who are in charge of redistributive policies.

Suggested Citation

  • Bellani, Luna & Fazio, Andrea & Scervini, Francesco, 2022. "Collective negative shocks and preferences for redistribution: Evidence from the COVID-19 crisis in Germany," Working Papers 08, University of Konstanz, Cluster of Excellence "The Politics of Inequality. Perceptions, Participation and Policies".
    • Handle: RePEc:zbw:cexwps:08
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    Cited by:

    1. Hamza Umer, 2023. "A selected literature review of the effect of Covid-19 on preferences," Journal of the Economic Science Association, Springer;Economic Science Association, vol. 9(1), pages 147-156, June.
    2. Sandra H. Goff & John Ifcher & Homa Zarghamee & Alex Reents & Patrick Wade, 2023. "Support for bigger government: The principle‐implementation gap and COVID‐19," Contemporary Economic Policy, Western Economic Association International, vol. 41(2), pages 243-261, April.

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    More about this item

    Keywords

    preferences for redistribution; inequality aversion; COVID-19;
    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
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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