Why Do the Rich Oppose Redistribution? An Experiment with America’s Top 5%

49 Pages Posted: 12 Jun 2019 Last revised: 23 Jun 2021

See all articles by Alain Cohn

Alain Cohn

University of Michigan

Lasse J. Jessen

University of Kiel - Faculty of Economics and Social Sciences

Marko Klasnja

New York University

Paul Smeets

Maastricht University

Date Written: June 16, 2021

Abstract

We show that the wealthiest 5% in the U.S. favor less government redistribution than the general population. Differences in tax and political attitudes between the top 5% and bottom 95% are not just due to self-interested reasons but rather driven by different fairness views. Wealthy Americans have a higher tolerance for inequality, measured in an experiment in which individuals act as third-party spectators and make distributive choices between two workers. The gap in inequality acceptance is primarily driven by business owners and individuals who acquired wealth over their lifetime rather than those who were born into wealth. Our findings raise the possibility that wealthy individuals, especially those who experienced upward social mobility, contribute to the persistent economic inequality in the U.S.

Keywords: redistribution, social preferences, experimental economics, inequality

JEL Classification: D31, D63, D91, H20, H31

Suggested Citation

Cohn, Alain and Jessen, Lasse J. and Klasnja, Marko and Smeets, Paul, Why Do the Rich Oppose Redistribution? An Experiment with America’s Top 5% (June 16, 2021). Available at SSRN: https://ssrn.com/abstract=3395213 or http://dx.doi.org/10.2139/ssrn.3395213

Alain Cohn

University of Michigan ( email )

105 S State St
Ann Arbor, MI 48109
United States

Lasse J. Jessen

University of Kiel - Faculty of Economics and Social Sciences ( email )

Kiel
Germany

Marko Klasnja

New York University ( email )

715 Broadway
New York, NY 10003
United States

HOME PAGE: http://https://files.nyu.edu/mk3296/public/index.html

Paul Smeets (Contact Author)

Maastricht University ( email )

P.O. Box 616
Maastricht, 6200MD
Netherlands
+31433883643 (Phone)

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