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Inequality aversion and risk‐aversion are widely assumed in economic models; however existing economic literature fails to distinguish between the two. This paper presents methodology and a laboratory experiment, which separates inequality aversion from risk aversion. In a set of laboratory experiments, subjects had to choose between two risky alternatives which pay meaningful prizes with the same individual risk but different levels of egalitarianism. Thus, the choice of the more egalitarian alternative implies a higher level of inequality aversion. The experiment was conducted among children, some of whom live on a communal system (kibbutz) and some in the city.

This paper examines how to satisfy a separability condition related to "independence of the utilities of the dead" (Blackorby et al., 1995; Bommier and Zuber, 2008) in the class of "expected equally distributed equivalent" social orderings (Fleurbaey, 2010). It also inquires into the possibility to keep some aversion to inequality in this context. It is shown that the social welfare function must either be utilitarian or take a special multiplicative form. The multiplicative form is compatible with any degree of inequality aversion, but only under some constraints on the range of individual utilities.

Social insurance motivations consider the welfare of others who are in potentially unfavorable situations. However, their role in increasing support for redistribution is not yet fully understood. The experiment reported here examined distributional decisions in which participants determined income distribution without being informed to which income class they would belong. This was contrasted with decisions made in lottery situations. Lottery decisions had the same risk for oneself, but they lacked a social context, namely the influence on the incomes of others. Less risky (more equal) decisions were observed in distributional decisions than in lottery decisions. Further, the selection of equality in distributional decisions (but not the risk aversion observed in lottery decisions) was positively correlated with support for welfare policies, which had been measured by a pre-experiment survey. This study observed the critical role of social context, which promotes the consideration of the welfare of others in fostering support for redistribution.

AbstractThis paper provides evidence of the changing attitudes to inequality during transition to the market in Poland. Using repeated cross‐sections of the population, it identifies a structural break in the relationship between income inequality and satisfaction. Whereas in the first stage of the transition process, an increase in income inequality was interpreted by the population as a positive signal of wider opportunities, later in the transition period increased inequality became a factor in dissatisfaction with the country's economic situation. This was accompanied by increasing public sentiment that the process of income distribution is flawed and corrupt.

Many firms use subjective performance appraisal systems due to lack of objective performance measures. In these cases, supervisors usually have to rate the performance of their subordinates. Using such systems, it is a well established fact that many supervisors tend to assess the employees too good (leniency bias) and that the appraisals hardly vary across employees of a certain supervisor (centrality bias). We explain these two biases in a model with a supervisor, who has preferences for the utility of her inequality averse subordinates, and discuss determinants of the size of the biases. Extensions of the basic model include the role of supervisor's favoritism of one particular agent and the endogenous effort choice of agents. Whether inequality averse agents exert higher efforts then purely self-oriented ones, depends on the size of effort costs and inequality aversion. -- Appraisals ; inequality aversion ; performance evaluation ; centrality bias ; leniency bias

This paper provides evidence of a change in the relationship between individual satisfaction with the state of country's economy and income inequality during transition from a command to market economic system. Using data from a series of extensive and frequent surveys of Polish population, we identify a structural break in this relationship. In the beginning of transition, an increase in income inequality is interpreted by population as a positive signal of increased opportunities; this sentiment is particularly strong among older people and people with right-wing political views. Later in the transition period, increased inequality becomes an important reason for dissatisfaction of the public with the country's economic situation and reforms, as people become more skeptical about the legitimacy of income generation process. We also provide direct evidence from opinion polls of a change in the public sentiment about income inequality. ; Cet article illustre le retournement de la tolérance aux inégalités au cours d'une période de forte croissance et de transformation économique et politique rapide. Il s'appuie sur l'expérience polonaise de transition économique et explore les attitudes subjectives des citoyens recueillies dans des enquêtes répétées, à haute fréquence, de 1992 à 2005. Une rupture entre l'inégalité et la satisfaction est identifiée aux alentours de l'année 1997. Cette évolution coïncide avec la montée, au sein de la population, d'un certain rejet des élites politiques.

This paper provides evidence of a change in the relationship between individual satisfaction with the state of country's economy and income inequality during transition from a command to market economic system. Using data from a series of extensive and frequent surveys of Polish population, we identify a structural break in this relationship. In the beginning of transition, an increase in income inequality is interpreted by population as a positive signal of increased opportunities; this sentiment is particularly strong among older people and people with right-wing political views. Later in the transition period, increased inequality becomes an important reason for dissatisfaction of the public with the country's economic situation and reforms, as people become more skeptical about the legitimacy of income generation process. We also provide direct evidence from opinion polls of a change in the public sentiment about income inequality. ; Cet article illustre le retournement de la tolérance aux inégalités au cours d'une période de forte croissance et de transformation économique et politique rapide. Il s'appuie sur l'expérience polonaise de transition économique et explore les attitudes subjectives des citoyens recueillies dans des enquêtes répétées, à haute fréquence, de 1992 à 2005. Une rupture entre l'inégalité et la satisfaction est identifiée aux alentours de l'année 1997. Cette évolution coïncide avec la montée, au sein de la population, d'un certain rejet des élites politiques.