1. Are People Willing to Pay for Reduced Inequality?
- Author
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Brian Hill, Thomas Lloyd, Ecole des Hautes Etudes Commerciales (HEC Paris), HEC Paris Research Paper Series, HEC Paris - Recherche - Hors Laboratoire, Centre National de la Recherche Scientifique (CNRS), Groupement de Recherche et d'Etudes en Gestion à HEC (GREGH), and Ecole des Hautes Etudes Commerciales (HEC Paris)-Centre National de la Recherche Scientifique (CNRS)
- Subjects
JEL: D - Microeconomics/D.D3 - Distribution ,History ,Point of sale ,Political spectrum ,Polymers and Plastics ,Inequality ,media_common.quotation_subject ,Population ,computer.software_genre ,Industrial and Manufacturing Engineering ,Politics ,Willingness to pay ,Economic inequality ,0502 economics and business ,Economics ,Production (economics) ,inequality information provision ,Income inequality ,050207 economics ,Business and International Management ,10. No inequality ,education ,media_common ,JEL: D - Microeconomics/D.D9 - Intertemporal Choice ,education.field_of_study ,050208 finance ,inequality attitude ,05 social sciences ,[SHS.PHIL]Humanities and Social Sciences/Philosophy ,1. No poverty ,[SHS.ECO]Humanities and Social Sciences/Economics and Finance ,JEL: D - Microeconomics/D.D6 - Welfare Economics/D.D6.D63 - Equity, Justice, Inequality, and Other Normative Criteria and Measurement ,8. Economic growth ,inequality reporting ,[SHS.GESTION]Humanities and Social Sciences/Business administration ,Demographic economics ,willingness to pay ,computer - Abstract
In the face of rising income inequality (Acemoglu & Autor, 2011; Atkinson, Piketty, & Saez, 2011; Piketty, 2014; World Economic Forum, 2014), one recent proposal is to provide consumers with information about the income inequality across those involved in the production of each good, at the point of purchase. This has been shown to depress overall inequality (Hill, 2020), though its impact depends crucially on whether people are willing to pay more for goods whose production involves less income inequality. Here we investigate this largely unexplored empirical question through an incentivised, behavioural choice experiment on a representative sample of the English population. We find that a large majority are willing to pay significantly more for goods associated with less inequality. How much more people are willing to pay varies with political leaning and increases with the extent of the inequality reduction, but is positive across the political spectrum and for all studied inequality differences. Moreover, it is typically higher when inequality is reported in more intuitive and informa- tive formats. Our results bode well for the effectiveness of product-level inequality information provision as a tool for moderating income inequality, promising impacts even in markets where all goods involve relatively high inequality levels and potential participation across the political spectrum.
- Published
- 2020