Working Paper: NBER ID: w22462
Authors: Matthew Weinzierl
Abstract: U.S. survey respondents’ views on distributive justice are shown to differ in two specific, related ways from what is conventionally assumed in modern optimal tax research. A large share of respondents, and in some cases a large majority, resist the full equalization of inequality due to brute luck that standard analyses would recommend. Related, a similar share prefer a classical benefit-based logic for the assignment of taxes over the conventional logic of diminishing marginal social welfare. Moreover, these two views are linked: respondents who more strongly resist equalization are more likely to prefer the classical benefit-based principle. Together, these results suggest that a large share of the American public views the allocation of pre-tax incomes as relevant to optimal tax policy and—at least in part—justly deserved unless proven otherwise, judgments that are inconsistent with standard welfarist objectives.
Keywords: Inequality; Taxation; Distributive Justice; Public Opinion
JEL Codes: D63; H21
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| acceptance of inequality due to brute luck (D63) | preference for classical benefit-based taxation (CBBT) (H29) |
| acceptance of inequality due to brute luck (D63) | moral significance in pretax incomes (A13) |
| preference for classical benefit-based taxation (CBBT) (H29) | beliefs about distributive justice (D63) |