Why Do (Some) Ordinary Americans Support Tax Cuts for the Rich? Evidence From a Randomized Survey Experiment

85 Pages Posted: 19 Aug 2021

See all articles by David Hope

David Hope

King's College London

Julian Limberg

King's College London - Department of Political Economy

Nina Weber

King's College London

Date Written: August 17, 2021

Abstract

Why do (some) ordinary citizens support tax cuts for the rich? A prominent explanation in the political economy literature stresses the role of unenlightened self-interest. According to this view, citizens consistently fail to gauge whether they are directly affected by tax policy reforms. We use a randomized survey experiment in the US to identify the drivers of preferences for cutting taxes on the rich. The results show that informing individuals of whether they are directly affected by a cut in the top federal income tax rate has no impact on preferences. We therefore find no support for the unenlightened self-interest explanation. In contrast, we find preferences for taxing the rich are fundamentally affected by information that shifts citizens' core fairness beliefs, as well as information on the past trajectory of top tax rates. Our results therefore align with explanations of tax policy preferences that emphasize the importance of fairness perceptions and reference points.

Keywords: Top Income Tax, Distributive Preferences, Top 1%, Tax Cuts

JEL Classification: D63, D83, D91, H24

Suggested Citation

Hope, David and Limberg, Julian and Weber, Nina, Why Do (Some) Ordinary Americans Support Tax Cuts for the Rich? Evidence From a Randomized Survey Experiment (August 17, 2021). Available at SSRN: https://ssrn.com/abstract=3906631 or http://dx.doi.org/10.2139/ssrn.3906631

David Hope

King's College London ( email )

Strand Building
London
United Kingdom

Julian Limberg

King's College London - Department of Political Economy ( email )

Strand Building
London
United Kingdom

Nina Weber (Contact Author)

King's College London ( email )

Strand
London, England WC2R 2LS
United Kingdom

HOME PAGE: http://www.ninasophieweber.com/

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