In this research project, we investigate differences in the motivational foundations of preferences for redistribution. Our guiding research question is why some individuals, although materially equally wealthy, prefer more redistribution than others. We take into account differences in the institutional design of social policy and argue that it is the level of insurance, or income replacement in case of income-loss, in combination with the probability of getting unemployed that defines an individual’s level of economic security. Once such economic security is provided, we expect people to demand higher levels of redistribution with increasing levels of income inequality. In other words, we assume people to be both, materially self-interested and altruistically motivated. Inequity aversion as a restricted form of altruism in our approach is modelled as a function of economic security and income distances. The further away the rich are from the poor, and the more secured they are to maintain their living standard, the more likely the better-off are to redistribute some of their economic wealth to those at the other end of the income strata.
To test the theoretical model empirically, we use lab experiments and combine (1) the level of insurance, (2) the probability of becoming unemployed, and (3) the level of income inequality between individuals. With this research design that allows us to interfere in the data generating process, we aim to getting closer towards understanding causal mechanisms.
