The goal of my project titled “Cutthroat Capitalism and Luck: Does Governmental Action Benefitting “a Lucky Few” Increase Individuals’ Desire to Redistribute,” was to test the impact that the source of luck in scenarios of inequality has on redistributive preferences. Income inequality in the United States has increased considerably over the past 30 years and is currently at a historically high level. However, while inequality has been rising steadily, taxes have not. So, the question remains, why do Americans not support or call for policies that would result in a more equal society despite these statistics?

Americans generally tend to perceive economic inequality stemming from merit as being fair and inequality stemming from luck as unfair. However, “lucky breaks” in the real world do not necessarily come from a lottery or random chance. Particularly, I aimed to study how luck stemming from governmental action influences individuals’ desire to redistribute earnings. To study this, I analyzed a spectator’s willingness to redistribute earnings between two workers in a simple effort-based task. The aim was to see if a "government-like" figure unfairly advantaged one individual in the study, would a spectator be more likely to redistribute earnings. I compared this scenario to spectators’ decision to redistribute in two other conditions: when the unequal distribution between workers was merit-based and when the distribution was determined by a random lottery. The experimental design of my study was based on a paper by Almas et al. (2020) titled, “Cutthroat Capitalism versus Cuddly Socialism: Are Americans more meritocratic and efficiency-seeking than Scandinavians?” However, I chose to focus solely Americans fairness perceptions and added a new “governmental luck treatment.” I recruited 1,413 American residents above the age of 18 from Amazon Mturk to complete my study.

Analysis of the data proved to replicate the findings of the Almas al. (2020) paper in the merit and luck conditions. The novel “governmental luck” condition in my study exhibited the highest levels of redistribution by spectators, yet the results were not statistically significant. These findings show the way in which the source of luck is presented to an individual does seem to influence how they perceive inequality, and if the study were to be run again with a larger sample size perhaps this trend would be clearer in the data.

Overall, this experience provided me with useful new skills in research and data collection in the social sciences. I am grateful to CURF for the opportunity to craft and execute my own study and further explore my interest in my PPE theme: Choice and Behavior. I would also like to thank my advisor and mentor Dr. Abraham Aldama Navarrete who provided me with tremendous guidance throughout the research process.