The Distributional Preferences of Americans∗

This paper characterize the distributional preferences of a large and diverse sample of Americans. We decompose distributional preferences into two distinct components — fair-mindedness (tradeoffs between oneself and others) and equality-efficiency tradeoffs — by estimating constant elasticity of substitution utility functions at the individual level. We find considerable heterogeneity in both the extent of fairmindedness and willingness to trade off equality and efficiency, much of which cannot be explained by standard demographic and socioeconomic characteristics. After controlling for individual characteristics, our experimental measure of equality-efficiency tradeoffs predicts the political decisions of our subjects; there is no significant relationship between our experimental measure of fair-mindedness and political preferences. Since optimal tax policy depends on the distributional preferences of voters and taxpayers, our findings can inform debates about government redistribution. JEL Classification Numbers: C91, D64 ∗We thank Daniel Markovits, Daniel Silverman, and conference participants at Lund University and the Stanford Institute for Theoretical Economics for helpful discussions and comments. We thank the American Life Panel team at the RAND Corporation for software development and technical and administrative support. We acknowledge financial support from the Center for Equitable Growth (CEG) at the University of California, Berkeley. †Fisman: Columbia University (email: [email protected]); Jakiela: University of Maryland (email: [email protected]); Kariv: University of California, Berkeley (email: [email protected]).