(Un)Fair inequality in the labor market: A global study

How do citizens of different societies perceive the fairness of inequalities? Answering this question is key in order to interpret the stability of existing inequalities, to grasp political polarization, and to inform the design of policies that ensure public support for the economic system.

Citizens may perceive inequalities as unfair because actual inequalities do not square with their fairness preferences, or because they have biased beliefs about the actual inequality and its sources. Previous studies have I) elicited preferences and beliefs, and II) provided flexible ways to measure unfairness using observational data. However, to date there is no coherent framework and data collection effort that integrates these elements and enables us to measure and understand perceived unfairness and its consequences for society.

In this project we will provide such a framework and data collection effort. First, we will develop a survey module that elicits information on i) fairness preferences and ii) beliefs about inequality that will be integrated with observational data on individual characteristics and earnings. After implementing our survey module in a diverse set of 20 countries around the globe, we will provide consistent measures of the magnitudes and drivers of perceived unfairness.

Last, we will analyze how perceptions about unfairness relate to a variety of societal phenomena including support for redistribution, trust in government, and support for democracy.