How much inequality of earnings do people perceive as just? The effect of interviewer presence and monetary incentives on inequality preferences

Abstract

This paper describes two studies designed to test how two structural conditions of an interview situation - the presence of an interviewer and use of incentives - influence respondents' preferences regarding inequality. According to goal-framing theory and findings from empirical justice research, different goal frames are activated in different types of relationships, producing different distributional preferences: Cooperative situations induce a normative goal frame resulting in a stronger preference for equality whereas competitive situations induce a gain frame in which individuals have stronger preferences for inequality. Assuming the former type of relationship is established by the presence of an interviewer and the latter type by incentivizing, we conducted two studies to test our hypotheses. The results suggest that building a cooperative relationship through interviewer presence and cooperation priming leads to a preference for equality, while use of incentives leads to a clear preference for inequality.