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The Human Aversion to Economic Equality

It’s pretty widely understood that people naturally dislike income disparities, and economists are always talking about ways to obviate those disparities; however, in lieu of how much this may all seem like common sense, societies thrive on the fact that people continually support the very institutions that protect the consolidation of wealth among the few. A team of researchers in China wanted to determine why it is—from a psychological standpoint—that people repeatedly do things and behave in such a way that protects the status quo of which they do not approve. The conclusion they drew was that people simply have an innate fear that the redistribution of wealth will upset the social hierarchy.

More to the point, Professor Zhou Xinyue at Zhejing University business school concluded with his colleagues that people unconsciously safeguard the social hierarchy despite it disadvantaging them. Zhou and his colleagues organized an experiment in which they used a game to determine how people would react to the opportunity to redistribute income among two people. The players were essentially the subjects of the experiment as published in Nature Human Behavior, the psychology journal.

 

Annalee Newitz, Ars Technica tech culture editor, found their study and the game therein to be insightful as she recounted how it was constructed. “Players were shown pictures of two people and told that one has randomly been given a large amount of money and the other a small amount,” Newitz explained. “Then players were asked whether they would be willing to allow the money to be redistributed under two basic conditions: one, if the redistribution leaves the “rich” person still richer than the other; and two, if the redistribution reverses the roles and leaves the “rich” person poorer than the other.”

 

Zhou and his team tested the subjects and proceeded with similar tests for Indian and White subjects using Mechanical Turk. They wanted to diversify their subjects culturally so as to pontificate about the universality of their results. Their findings brought them rather shockingly uniform responses. 76.87 percent of the players involved were willing to go forward with the redistribution of wealth in the event that the rich person still remained marginally better off than the poor person; in other words, the social hierarchy was not imbalanced or upset.

A mere 44.8 percent of subjects went as far as to redistribute wealth to the extent of reversing the roles of the rich and poor.

The game involved four different choice problems, as Newitz broke it down. “Accepting the transfer in both type I and type II trials yielded the same final distribution of payoffs, but in the type I trial, the hierarchy was reversed. Accepting the transfer in this case would reverse the rank ordering of the two individuals. Comparing behavior with the type I and type II trials gives a measure of hierarchical reversal aversion. Inclusion of the type III and type IV trials allows the researchers to control for transfer size and loss aversion.”

Zhou’s team identified this bizarre tendency in the subjects’ responses as a sort of so-called rank-reversal aversion; he classified it as an unwillingness to change the status quo. When children were tested with the same game, Zhou’s research team concluded that this rank-reversal aversion doesn’t manifest in children until somewhere between six and 10 years old. The significance of this is that it implies the aversion is a culturally learned or conditioned position. In other words, it is not psychologically fundamental to how human beings think. In fact, they even ventured to estimate that the urge to redistribute wealth starts developing around age four.

 

Lots of people have very deeply rooted ideas that fundamentally conflict with one another. They don’t particularly like economic inequities, but they also don’t revel in upsetting the hegemony of established systems. Zhou and his team found this to be justification for why some people struggle with solving the ills of social inequalities as well.

 

Newitz pontificated, “What’s especially intriguing is that this study reveals that people didn’t like to see other people’s fortunes reversed. So this isn’t about selfishness or protecting what’s yours. It’s some kind of fear of upsetting the hierarchy that goes beyond greed.” Certainly, Newitz has a fair point that this psychological phenomenon is more nuanced than mere avarice; however, there isn’t necessarily enough in the study to rule out greed as a significant factor.

Patrick Casement wrote a psychological discourse in 1990 called, Further Learning from the Patient, in which he unpacked an even older concept that is very fundamental to Freudian psychoanalysis, which is that of the human proclivity to project hope. Psychological projection in the Freudian sense manifests in several different ways, and this is only one; however, Casement unpacked it as a common problem that psychiatrists encounter because patients begin to project their hope on to their therapists in some cases. The significance of this, though, is that, when faced with an opportunity to remedy a condition they deem unfavorable, they begin to use the opportunity—whether a therapist or a game—not as a means to fix the problem but as a means to experience what they hope for themselves.

 

On one hand, Freudian psychoanalysis suggests the possibility that subjects want to protect their goal of affluence by seeing to it that roles cannot be reversed in the event they were to ever experience it. On the other hand, economists Marie Claire Villeval and Gary Charness write in an article related to the Zhou study, that this aversion may be more akin to the concept of loss aversion, which is arguably more pertinent than the broad notion of projection. It is a syndrome in which “a demotion in […] rank triggers a more negative effect on motivation than a promotion boosts effort.”

 

The issue isn’t about eliminating rank from the equation. It’s about altering the way people conceptualize opportunity. No one wants to remove the stability of their own goal, so those who have much may very well deserve much because they may have earned it the way these same subjects intend to earn it for themselves.

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