Social Preferences and Voting on Reform: An Experimental Study

Fabian Paetzel, Rupert Sausgruber, Stefan Traub

Publication: Working/Discussion PaperWU Working Paper

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Abstract

Debating over efficiency-enhancing but inequality-increasing reforms accounts for the routine business of democratic institutions. Fernandez and Rodrik (1991) hold that anti-reform bias can be attributed to individual-specific uncertainty regarding the distribution of gains and losses resulting from a reform. In this paper, we experimentally demonstrate that anti-reform bias arising from uncertainty is mitigated by social preferences. We show that, paradoxically, many who stand to lose from reforms vote in favor because they value efficiency, while many who will potentially gain from reforms oppose them due to inequality aversion.
Original languageEnglish
Place of PublicationVienna
PublisherWU Vienna University of Economics and Business
DOIs
Publication statusPublished - 1 Apr 2014

Publication series

SeriesDepartment of Economics Working Paper Series
Number172

WU Working Paper Series

  • Department of Economics Working Paper Series

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