TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Monday, June 12, 2017

People Are Bothered By Economic Unfairness, Not Economic Inequality

Nature: Why People Prefer Unequal Societies, by Christina Starmans (Yale), Mark Sheskin (Yale) & Paul Bloom (Yale):

There is immense concern about economic inequality, both among the scholarly community and in the general public, and many insist that equality is an important social goal. However, when people are asked about the ideal distribution of wealth in their country, they actually prefer unequal societies. We suggest that these two phenomena can be reconciled by noticing that, despite appearances to the contrary, there is no evidence that people are bothered by economic inequality itself. Rather, they are bothered by something that is often confounded with inequality: economic unfairness. Drawing upon laboratory studies, cross-cultural research, and experiments with babies and young children, we argue that humans naturally favour fair distributions, not equal ones, and that when fairness and equality clash, people prefer fair inequality over unfair equality. Both psychological research and decisions by policymakers would benefit from more clearly distinguishing inequality from unfairness.

Figure 2

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Oh my Paul Bloom. First, "Against Empathy: The Case for Rational Compassion" and now this. Very encouraging signs of thoughtfulness and courage in the Ivy League.

Posted by: MG | Jun 12, 2017 12:56:14 PM

Food for thought: How would the government go about redistributing wealth? Legally, I mean. Income, capital gains, and real estate are already taxed, so we're left with, what, tax-deferred retirement accounts? Everywhere else the state's already got its hand in the cookie jar...

Posted by: MM | Jun 12, 2017 7:14:51 PM

Very interesting article. The lightbulb is on! And as usual, some people missed the point entirely.

Posted by: Publius Novus | Jun 13, 2017 8:15:59 AM

"And as usual, some people missed the point entirely."

What a profound policy proposal. Progressivism certainly is lost in the wilderness these days...

Posted by: MM | Jun 13, 2017 6:38:41 PM

Principles of fairness are starkly different for left-wingers and right-wingers. Incompatible views of fairness lie at the heart of virtually all ideological disagreements.

If someone disagrees with your view of fairness, that doesn't make the person evil nor a proponent of unfairness, nor stupid nor even misguided . It merely means that person has a different opinion of how to improve fairness. If you presume otherwise you are mistaken at best, foolishly arrogant at worst.

Posted by: AMTbuff | Jun 13, 2017 9:37:30 PM

If I have to choose between simple and lower tax rates and fair with higher tax rates, simple and low wins every time. At some point simple and low becomes fair because nobody cares anymore.

Posted by: Dale Spradling | Jun 14, 2017 4:56:38 AM

About 35 years ago, I saw an article (by a writer for Mother Jones, IIRC) who was assessing the then faddish idea of 'comparable worth'. Her conclusion was that assessing the 'worth' of dissimilar jobs was hopeless, ergo everyone should be paid the same. One step forward, one back.

Some years later, Barbara Ehrenreich and Frances Fox Piven penned a chiding letter to The New Republic offering that the federal government should institute a guaranteed income equal to the household median and then businesses would be compelled to pay people more generously. It was not widely known at the time that Ehrenreich was a lapsed college professor, and her specialty had been biochemistry (which evidently does not require numeracy).

Posted by: Art Deco | Jun 14, 2017 8:59:46 AM

Anywho, bar Barbara Ehrenreich and persons in her social circle, I don't think I've ever encountered anyone in print arguing for absolute equality. The question is what would be the proper contours and conduits of inequality.

Posted by: Art Deco | Jun 14, 2017 9:01:52 AM

I don't think fairness is defined or quantified in the law or the tax code. Perhaps I missed something. It's a moral concept, which is ironic considering the political party now espousing it spent the 1990s arguing that morality couldn't be legislated, and that the personal moral conduct of the President of the United States did not matter. My, how times have changed. Full circle, almost...

Posted by: MM | Jun 14, 2017 6:42:04 PM

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