Public Finance in the Era of the COVID-19 Crisis
18-20 August 2021 | Online, Organized by University of Iceland, Reykjavík
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Please note that all times are shown in the time zone of the conference. The current conference time is: 2nd Dec 2021, 12:25:37pm GMT
H03: Inequality Perceptions
9:00am - 9:22am
Overconfidence, Income-Ability Gap, and Preferences for Income Equality
1Tokyo University of Science, Japan; 2Princeton University, USA
Overconfident people who do not earn what they think they can may attribute this negative gap to the unfairness of the economy and thereby favor reducing income inequality when they realize their income-ability gap. We conducted an online survey experiment in the US in which we assigned the treatment emphasizing each respondent's self-perception of the income-ability gap randomly. We found that realizing the negative income-ability gap lowers respondents' perception of the fairness of the economy independently of political ideologies. However, its effect on the support for reducing income inequality was heterogeneous. Only left-wing people increased the support for reducing income inequality, but even left-wing people did not increase the support for government interventions in correcting inequality.
9:22am - 9:45am
Rich vs Poor: Inequality Perceptions, Information and Redistributive Policy Support
University of Konstanz, Germany
This paper contributes to the study of how information on and perceptions of inequality matter for policy support. Using a survey experiment, we provide respondents with information on actual inequality. We have two separate treatments, one provides information on the share of income going to the richest 10% of all households, the other on the share going to the poorest 10%. Three main results emerge from our analyses: First, there is a priming effect of pointing people towards focusing on the rich vs. the poor. Second, information on the upper end of the distribution shifts policy support more than information on the lower end. Third, changes in inequality perceptions have an effect on concrete policy proposals, but do not affect general attitudes towards redistribution.
9:45am - 10:07am
Social Position and Fairness View
1University of Copenhagen, Denmark; 2Harvard University, US
We link survey data containing Danish people’s perceptions of where they rank in various reference groups and fairness views with administrative records on their income history, life events, and reference groups. People know their income positions well, but believe others are closer to themselves than they really are. The perceived fairness of inequalities is strongly related to current social position, moves with shocks to social position (e.g. unemployment or promotions), and changes when people are experimentally shown their actual positions. People view inequalities within education group and co-workers as most unfair, but underestimate inequality the most exactly within these reference groups.
10:07am - 10:30am
Gender Norms and Income Misreporting Within Households
University of Basel, Switzerland
We demonstrate that individuals’ survey responses are prone to the influence ofgender norms. Drawing on Swiss and Austrian data combining survey and admin-istrative information for the same couple, we find that couples where the womanoutearns her partner misreport their incomes such that they comply with themalebreadwinner norm. This introduces a systematic bias into surveyed incomes andleads to a considerable overestimation of policy relevant measures like the genderwage gap, which is frequently based on survey data. Furthermore, surveyed incomeinformation can lead to false conclusions about individuals’ labor market behaviorif taken at face value.
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