The fairness of inequality due to risk and effort choices

Arbeitspapier

Three determining factors for economic inequality are self-chosen effort, self-chosen risk, and external circumstances. The fairness people assign to inequalities due to effort and external circumstances is widely studied. Insights on the fairness of inequalities due to self-chosen effort and self-chosen risk, however, are lacking. I study a novel experimental setting where inequality is due to a choice over effort-provision and a choice over risk-taking. While the resulting inequality is mostly seen as fair, around 10% of third-party redistribution decisions are in line with a fairness norm that only considers the choice over effort.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Discussion Papers of the Max Planck Institute for Research on Collective Goods ; No. 2022/5

Classification and Topics

• Classification: Wirtschaft ; Design of Experiments: Laboratory, Individual ; Equity, Justice, Inequality, and Other Normative Criteria and Measurement ; Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making‡
• Subject: Inequality ; Fairness ; Risk-taking

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Sterba, Maj-Britt
• Event: Veröffentlichung
• (who): Max Planck Institute for Research on Collective Goods
• (where): Bonn
• (when): 2022

Further information

• Handle: http://hdl.handle.net/10419/274054
• Last update: 10.03.2025, 11:45 AM CET