The Tradeoff between Redistribution and Effort: Evidence from the Field and from the Lab

36 Pages Posted: 7 May 2012

See all articles by Claudia M. Buch

Claudia M. Buch

Deutsche Bundesbank

Christoph Engel

Max Planck Society for the Advancement of the Sciences - Max Planck Institute for Research on Collective Goods; University of Bonn - Faculty of Law & Economics; Erasmus University Rotterdam (EUR), Erasmus School of Law, Rotterdam Institute of Law and Economics, Students; Universität Osnabrück - Faculty of Law

Multiple version iconThere are 2 versions of this paper

Date Written: April 30, 2012

Abstract

Building on a theoretical model we test the hypothesis that effort choices and preferences for redistribution are simultaneously determined. Using cross-country panel data from the World Value Survey, we find that it is important to model preferences for redistribution and effort choices simultaneously. While respondents with stronger preferences for redistribution tend to have smaller incentives to engage in effort, the reverse does not hold true. Using a lab experiment, we show that redistribution choices even increase in imposed effort. Those with higher ability are willing to help the needy if earning income becomes more difficult for everybody.

Keywords: effort, redistribution, World Value Survey, simultaneous equation models, experiment

JEL Classification: C310, C910, D310, J280

Suggested Citation

Buch, Claudia M. and Engel, Christoph, The Tradeoff between Redistribution and Effort: Evidence from the Field and from the Lab (April 30, 2012). CESifo Working Paper Series No. 3808, Available at SSRN: https://ssrn.com/abstract=2053036

Claudia M. Buch (Contact Author)

Deutsche Bundesbank ( email )

Wilhelm-Epstein-Str. 14
Frankfurt/Main, 60431
Germany

Christoph Engel

Max Planck Society for the Advancement of the Sciences - Max Planck Institute for Research on Collective Goods ( email )

Kurt-Schumacher-Str. 10
D-53113 Bonn, 53113
Germany
+049 228 914160 (Phone)
+049 228 9141655 (Fax)

HOME PAGE: http://www.coll.mpg.de/engel.html

University of Bonn - Faculty of Law & Economics

Postfach 2220
D-53012 Bonn
Germany

Erasmus University Rotterdam (EUR), Erasmus School of Law, Rotterdam Institute of Law and Economics, Students ( email )

Burgemeester Oudlaan 50
PO Box 1738
Rotterdam
Netherlands

Universität Osnabrück - Faculty of Law

Osnabruck, D-49069
Germany

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
39
Abstract Views
499
PlumX Metrics