Culture and Redistribution

My dissertation empirically examines whether characteristics of one's social groups influence an individual's preferences for redistribution. I begin by focusing on the socioeconomic status of the ethnic and religious groups one belongs to. First, I develop a theoretical framework where an individual's identity is strengthened by the status of their group. Then, utilizing data from the US General Social Survey, I find evidence that the average incomes of one's ethnic and religious groups are negatively correlated with one's preferences for redistribution. Controlling for household income, and a number of other individual-level characteristics and additional controls, I find that a standard deviation increase in the average income of one's social groups correlates to a weakening of an individual's preferences for redistribution by seven to eight percentage points. This result is robust to the inclusion of rich controls and alternate measures of group status, as well as a number of robustness checks, such as sample restrictions and the use of additional data. I then examine the relative importance a culture places on individualism vs. collectivism. Utilizing data from the European Social Survey, I find evidence that immigrants who were born in countries with a more individualistic culture tend to have weaker preferences for redistribution in their residence country. A standard deviation increase in the individualism of one's home country culture correlates to a weakening of an individual's preferences for redistribution by twelve percentage points. This relationship appears to be as strong as that between household income and preferences for redistribution (eleven percentage points). This result is robust to the inclusion of rich controls and the use of sample restrictions. The relationship appears to be stronger among immigrants who vote, belong to an ethnic minority and live in a country with a relatively high number of ethnic minorities. I also find that the relationship between preferences for redistribution and i) household income and ii) education is stronger among immigrants born in a country with an individualistic culture. Moreover, my analysis suggests that this trait is transmitted across generations, and bears some influence on the preferences for redistribution of second-generation immigrants as well.