A defining feature of meritocratic societies is that resource distributions reflect individual effort levels. However, this introduces a dilemma in a world where parents care for their children. If one pair of parents works harder than a second pair...
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ZBW - Leibniz-Informationszentrum Wirtschaft, Standort Kiel
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A defining feature of meritocratic societies is that resource distributions reflect individual effort levels. However, this introduces a dilemma in a world where parents care for their children. If one pair of parents works harder than a second pair of parents, the first pair has merited the option to bequest more resources for their child. However, none of the two children has merited to inherit more resources than the other. Hence, if the two children end up with different amounts of resources, this inherited inequality may be considered simultaneously fair and unfair from a meritocratic standpoint. We develop a theoretical framework and run a preregistered survey experiment with about 550 subjects representative of the US population to investigate how people resolve this dilemma. In the experiment, impartial spectators redistribute payments between pairs of individuals. We vary whether inequality in the initial distribution is based on luck or effort and whether spectators redistribute between individuals who have worked on a task themselves to earn money (Non-Inherited Inequality) or between individuals who differentially benefit from the work of real-life friends (Inherited Inequality). Spectators equalize a much larger fraction of initial inequality if it is based on luck instead of effort. Yet, they do not differentiate much between situations in which they redistribute between individuals who have worked themselves and situations in which they redistribute between individuals who have differentially profited from their friends' work. The results suggest that most people find inequality fair if it is grounded in differential effort at some stage. This may help explain why many oppose redistributive policies in the real world.
