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Inequality and Relative Ability Beliefs

Bibliographic Data

ID9710858
AuthorsJeffrey V Butler (0000-0001-6401-7504, Einaudi Institute for Economics and Finance, corresponding author)
Year2016
Volume126
Issue593
Pages907-948
Publication date2016-06-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueThe Economic Journal (JOURNAL)
Journal identifiersISSN: 0013-0133 • E-ISSN: 1468-0297
PublisherOxford University Press (OUP) (PUBLISHER)
DOI10.1111/ecoj.12175
OpenAlexW2105715648
LanguageEN
Citations received3
References cited53

I present experimental evidence for a novel mechanism yielding inequality persistence. Just world beliefs research suggests that individuals believe they merit unequal treatment they experience. Merit depends on ability and effort so that disadvantage (advantage) may undermine (bolster) confidence in own relative ability. Because decisions determining economic success rely on such beliefs (e.g. competitiveness), inequality may self‐perpetuate. In multiple experiments, I randomly assign unequal pay for an identical task where performance depends on cognitive ability. I find that pay level consistently and substantially affects beliefs but not performance. Finally, I show that among males high pay increases competitiveness by 33

Cognition · Demographic economics · Disadvantage · Economics · Inequality · Microeconomics · Persistence (discontinuity · Political science · Positive economics · Public economics · Task (project management · Culture, Economy, and Development Studies · Decision-Making and Behavioral Economics · Experimental Behavioral Economics Studies · Law · Mathematics · Psychology · Social Psychology

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Unique citing works3
Citations per year0,43
Citation span2019 - 2023 (5)
Citation velocityhistorical
Highly citedNo
Citation typesNeutral: 3
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