Authors: Ilyana Kuziemko, Michael Norton, Emmanuel Saez and Stefanie Stantcheva
Publication: American Economic Review 105 (4): 1478-1508, 2015
Abstract: We develop online survey experiments to analyze how information about inequality and taxes affects preferences for redistribution. Approximately 4,000 respondents were randomized into treatments providing interactive, customized information on U.S. income inequality, the link between top income tax rates and economic growth, and the estate tax. An additional 6,000 respondents were randomized into follow-up treatments to explore mechanisms underlying the initial results. The treatment has very large effects on whether respondents view inequality as a problem. By contrast, it only slightly moves policy preferences (e.g., top income tax rates and transfer programs). An exception is the estate tax – informing respondents of the small share of decedents who pay it more than doubles support for it and this effect persists in a one-month follow-up. We explore several explanations for our results. Extreme ex-ante misinformation appears to drive the large estate tax results. The small effects for all other policies can be at least partially explained by respondents’ low trust in government -indeed, we show that priming people to think negatively about the government substantially reduces support for transfer programs – as well as a disconnect between concerns about social issues and the public policies that aim to address them.