Are People Inequality Averse, and Do They Prefer Redistribution by the State? Evidence from German Longitudinal Data on Life Satisfaction

By J. Schwarze, Marco Härpfer. Social Science Research Network, 2007

185 citations recorded by the source corpus.

We link life-satisfaction data to inequality of the pre-government income distribution at the regional level, to estimate the degree of inequality aversion. In addition, we investigate whether a reduction in inequality by the state increases individual well-being. We find that Germans are inequality averse over the entire income distribution. However, inequality reduction by the state does not increase well-being. On the contrary, inequality reduction places something of an excess burden on middle-income earners. The paper uses data from the German Socio-economic Panel Study (GSOEP) from 1985 to 1998.

Subfields: General Health Professions, Social Psychology, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/d95af4c720f708fd1263fa5532e9a512c567e67e

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In General Health Professions

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Citations in the corpus

Income Inequality and Subjective Well-being: A Cross-National Study on the Conditional Effects of Individual and National Characteristics (2013, background): “…inequality seems to reduce happiness1 in continental European countries such as Germany and France, and in Latin American countries, such as Brazil and Peru (Graham and Pettinato 2002; Schwarze and Härpfer 2002; Alesina et al. 2004; Fahey and Smyth 2004; O’Connell 2004; Graham and Felton 2005).”
The role of income aspirations in individual happiness (2004, unknown): “Empirical studies that focus on individuals’ distributive concerns and which use data on reported subjective well-being are e.g. Alesina et al. (2001), Hagerty (2000) Schwarze and Härpfer (2002) and Tomes (1986).”
A Vision for Human Well-Being: Transition to Social Sustainability (2012, unknown): “In Germany, inequality aversion appeared to negatively affect life satisfaction, an impact which government taxation and redistribution did not alleviate [102].”
Attitudes to Income Inequality: Experimental and Survey Evidence (2014, methodology): “…of Life satisfaction and happiness Positive Cojocaru (2014a) Crosscountry LiTS wave 1 Gini by census enumeration area level Life satisfaction No relation Schwarze and Härpfer (2007) calculated inequality in gross household income at the region and year level in 14 waves of German SOEP data.”
Recent Advances in the Economics of Individual Subjective Well-Being (2010, background): “Schwarze and Härpfer (2007) present evidence for Germany that people of all income classes report lower life satisfaction when regional income inequality increases.”