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Luck or Effort: Sharing Norms in the US and Europe

Authors:
Publication Date:
Jan 2012
Project Programs:
Behavioral Economics

We compare the determinants of individual giving between two countries, Spain and the US, which differ in their redistribution policies and their beliefs over the causes of poverty. By varying the information about the determinants of income, we find that, although overall giving is similar in both countries when subjects know the actual role of luck and effort, Spanish subjects give more than American subjects when they are uninformed. Using elicited beliefs, we find that this is due to the Spanish subjects’ association of poverty with bad luck and American subjects’ association of poverty with a lack of effort.

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