What Makes Me See Inequality as Just?

Economists should be interested in understanding the factors behind the fairness assessment of inequality since this codetermines individuals' willingness to cooperate and to exert positive reciprocity as a tax payer and citizen. So far, this topic has been largely neglected in the economic literature. This contribution wants to shed light on the factors behind the individual assessment of inequality: Why do some individuals consider the inequality in their country as just while others do not? Our empirical analysis based on survey data for Germany shows that very different forces shape the individual fairness assessment: distributive preferences, beliefs on the sources of inequality, satisfaction with democracy and several socio-economic characteristics. Given that the welfare and tax state depends on the voluntary cooperation of citizens, our insights are relevant for many political and economic contexts, such as tax compliance or welfare benefit cheating.