We use a tailor-made survey on a Swedish sample to investigate how individuals’ relative income affects their demand for redistribution. We ﬁrst document that a majority misperceive their position in the income distribution and believe that they are poorer, relative to others, than they actually are. We then inform a subsample about their true relative income and ﬁnd that individuals who are richer than they initially thought demand less redistribution. This result is driven by individuals with prior right-ofcenter political preferences who view taxes as distortive and believe that effort, rather than luck, drives individual economic success.
Review of Economics and Statistics
Richer (and Holier) Than Thou? The Effect of Relative Income Improvements on Demand for Redistribution