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Luck or Rights? An Experiment on Preferences for Redistribution Following Inheritance of Opportunity

Author

Listed:
  • Lekfuangfu, Warn N.

    (Universidad Carlos III de Madrid)

  • Powdthavee, Nattavudh

    (Nanyang Technological University, Singapore)

  • Riyanto, Yohanes E.

    (Nanyang Technological University, Singapore)

Abstract
We experimentally investigate whether people generally perceive inheritance as effort-induced or luck-induced. By randomly matched two strangers in a lab setting, we test whether the sources of opportunity handed down from the 'testator' subjects determines later redistributive decisions among the 'heir' subjects. On average, redistribution is highest among the heirs whose chance of winning is determined by the pure luck of the paired testator. In contrast, our subjects treat inherited opportunity generated by effort of someone else who they are artificially linked with as relatively fair. Our results suggest that people would feel entitled to bequests and inheritance unless the randomness of inheritance has been made salient to them.

Suggested Citation

  • Lekfuangfu, Warn N. & Powdthavee, Nattavudh & Riyanto, Yohanes E., 2022. "Luck or Rights? An Experiment on Preferences for Redistribution Following Inheritance of Opportunity," IZA Discussion Papers 15125, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp15125
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    Cited by:

    1. Yuchen Huang & Zhexun Mo, 2022. "Meritocracy as a WEIRD Phenomenon: Fairness Reasoning and Redistributive Preferences across the World," Working Papers halshs-04129246, HAL.
    2. Lu Dong & Lingo Huang & Jaimie W Lien, 2022. ""They Never Had a Chance": Unequal Opportunities and Fair Redistributions," Discussion Papers 2022-11, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
    3. Yuchen Huang & Zhexun Mo, 2022. "Meritocracy as a WEIRD Phenomenon: Fairness Reasoning and Redistributive Preferences across the World," World Inequality Lab Working Papers halshs-04129246, HAL.

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    More about this item

    Keywords

    inheritance; fairness; redistribution; experiment; inequality of opportunity;
    All these keywords.

    JEL classification:

    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue

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