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Title:Are People Inequality Averse, and Do They Prefer Redistribution by the State? Evidence From German Longitudinal Data on Life Satisfaction PDF Logo
Authors:Schwarze, Johannes
Härpfer, Marco
Issue Date:2002
Series/Report no.:IZA Discussion paper series 430
Abstract: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.
Subjects:Inequality aversion
redistribution
life satisfaction
panel data
JEL:I31
D63
D31
C23
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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