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Contribution Details

Type Working Paper
Scope Discipline-based scholarship
Title Fairness in winner-take-all markets
Organization Unit
  • Björn Bartling
  • Alexander Cappelen
  • Mathias Ekström
  • Erik Sørensen
  • Bertil Tungodden
  • English
Institution University of Zurich
Series Name Working paper series / Department of Economics
Number 287
ISSN 1664-7041
Number of Pages 31
Date 2018
Abstract Text The paper reports the first experimental study on people’s fairness views on extreme income inequalities arising from winner-take-all reward structures. We find that the majority of participants consider extreme income inequality generated in winner-take-all situations as fair, independent of the winning margin. Spectators appear to endorse a “factual merit” fairness argument for no redistribution: the winner deserves all the earnings because these earnings were determined by his or her performance. Our findings shed light on the present political debate on redistribution, by suggesting that people may object less to certain types of extreme income inequality than commonly assumed.
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Keywords Winner-take-all reward structures, fairness, income inequality, Einkommensverteilung, Einkommensumverteilung, Verteilungsgerechtigkeit, Fairness, Leistung