Motivated Meritocracy:

An Experiment in the Stability of Inequality Preferences

Brandon Williams

Development Economics

November 21, 2024

Motivated Meritocracy

Development Economics

November 21, 2024

Motivation

Inequality threatens long-term social and economic development, harms poverty reduction and destroys people’s sense of fulfillment and self-worth."

- United Nations Millennium Development Goals

Motivated Meritocracy

Development Economics

November 21, 2024

Motivation: Some Facts

  • 71% of the population live in country where inequality has risen since 1990
  • The source of inequality matters for preferences about redistribution:
    • Some accept all forms of inequality (libertarians)
    • Some accept inequality only if it is earned (meritocrats)
    • Some do not accept any form of inequality (egalitarians)
  • A considerable amount of literature has worked to study the share of these types across country, political views, and gender
  • Preferences about inequality are important because they strongly correlate with beliefs about policy

Motivated Meritocracy

Development Economics

November 21, 2024

Motivation

Motivated Meritocracy

Development Economics

November 21, 2024

Motivation: Some More Facts

  • Discrimination and in-group bias are real phenomena
  • Social desirability bias can lead to attenuated estimates of discriminatory intent in experiments
  • Evidence of discrimination tends to emerge when it can be hidden by other possible explanations
    • Choice of flowers to allocate to downstream workers
    • Effectiveness of mixed-team efforts in a factory

Motivated Meritocracy

Development Economics

November 21, 2024

Research Question

  • Are preferences about inequality stable? Or do they change depending on who benefits from redistribution?
    • Stable preferences would indicate that they are in some sense fundamental
      • Policymakers need to under their constituent base
      • Social and redistribution policies should reflect those views
    • Context-dependent preferences would indicate that these preferences could be used for veiled discrimination
      • Policymakers need to overcome some motivated preferences to develop cohesive policies
      • Economic or social power structures that claim to reduce inequality may in fact make it worse

Motivated Meritocracy

Development Economics

November 21, 2024

Objectives Today

  1. Explain experimental paradigm used to determine inequality preferences
  2. Provide a model of context-dependent inequality preferences that could bias true preferences and disguise discrimination
  3. Offer a unique context to explore this "motivated meritocracy" in the country of Fiji
  4. Outline experimental procedure to test hypotheses about the stability of inequality preferences

 

 

 

Collect feedback!

Motivated Meritocracy

Development Economics

November 21, 2024

Experimental Procedure

  • Two Types of Participants:
    • Workers - complete task for possible payment
    • Spectators - can decide on possible redistribution of payment

Motivated Meritocracy

Development Economics

November 21, 2024

  • The task requires little skill but real effort (e.g. ball-catching task, counting zeros)

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • One worker gets initial allocation according to treatment
    • Luck - a fair coin determines who is paid the whole amount
    • Merit - the more productive worker is paid the whole amount

$

$

$

$

$

$

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Spectators know the source of the allocation
  • Workers are not informed of the initial distribution, but are aware a spectator will have final say

$

$

$

$

$

$

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Before the workers are paid, the spectator can choose to redistribute: none

$

$

$

$

$

$

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Before the workers are paid, the spectator can choose to redistribute: none, some,

$

$

$

$

$

$

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Before the workers are paid, the spectator can choose to redistribute: none, some, or all

$

$

$

$

$

$

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Spectators can be classified by their choices over redistribution depending on treatment

$

$

$

$

$

$

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Spectators can be classified by their choices over redistribution depending on treatment

$

$

$

$

$

$

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Spectators can be classified by their choices over redistribution depending on treatment

$

$

$

$

$

$

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Spectators can be classified by their choices over redistribution depending on treatment

$

$

$

$

$

$

Meritocrat*

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Spectators can be classified by their choices over redistribution depending on treatment

$

$

$

$

$

$

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Spectators can be classified by their choices over redistribution depending on treatment

$

$

$

$

$

$

Egalitarian

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Spectators can be classified by their choices over redistribution depending on treatment

$

$

$

$

$

$

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Spectators can be classified by their choices over redistribution depending on treatment

$

$

$

$

$

$

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Spectators can be classified by their choices over redistribution depending on treatment

$

$

$

$

$

$

Libertarian

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Spectators can be classified by their choices over redistribution depending on treatment

$

$

$

$

$

$

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Spectators can be classified by their choices over redistribution depending on treatment

$

$

$

$

$

$

Egalitarian*

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

  • Spectators can be classified by their choices over redistribution depending on treatment
    • Egalitarians - the share dividing equally in the merit treatment
    • Libertarians - the share allocating everything to the lucky worker in the luck treatment
    • Meritocrats - the difference between the share of participants allocating more to the productive worker in the merit treatment and the share allocating more to the lucky worker in the luck treatment
    • Other - share redistributing in other ways

Experimental Procedure

Motivated Meritocracy

Development Economics

November 21, 2024

Some Results From Around the World

Motivated Meritocracy

Development Economics

November 21, 2024

A Model of (Context-Dependent) Inequality

\max_{y_1, y_2} V_i^{k(i)} = \theta_1 y_1 + \theta_2 y_2 - \beta_i \frac{(y_1 - m^{k(i)})^2}{2}

The spectator seeks to maximize their utility from the distribution of resources:

Weight to worker 1

Allocation to worker 1

Strength of inequality preferences

Inequality preferences

Motivated Meritocracy

Development Economics

November 21, 2024

A Model of (Context-Dependent) Inequality

\max_{y_1, y_2} V_i^{k(i)} = \theta_1 y_1 + \theta_2 y_2 - \beta_i \frac{(y_1 - m^{k(i)})^2}{2}

The spectator seeks to maximize their utility from the distribution of resources:

Since the overall pot is fixed, we can rewrite this as:

\max_{y_1} V_i^{k(i)} = X \theta_2 + y_1(\theta_1 - \theta_2) - \beta_i \frac{(y_1 - m^{k(i)})^2}{2}

Motivated Meritocracy

Development Economics

November 21, 2024

A Model of (Context-Dependent) Inequality

The spectator seeks to maximize their utility from the distribution of resources:

\max_{y_1} V_i^{k(i)} = X \theta_2 + y_1(\theta_1 - \theta_2) - \beta_i \frac{(y_1 - m^{k(i)})^2}{2}

Motivated Meritocracy

Development Economics

November 21, 2024

A Model of (Context-Dependent) Inequality

The spectator seeks to maximize their utility from the distribution of resources:

\max_{y_1} V_i^{k(i)} = X \theta_2 + y_1\underbrace{(\theta_1 - \theta_2)} - \beta_i \frac{(y_1 - m^{k(i)})^2}{2}

Difference in weights on two types of workers

Discrimination

Motivated Meritocracy

Development Economics

November 21, 2024

A Model of (Context-Dependent) Inequality

The spectator seeks to maximize their utility from the distribution of resources:

\max_{y_1} V_i^{k(i)} = X \theta_2 + y_1\underbrace{(\theta_1 - \theta_2)} - \beta_i \frac{(y_1 - m^{k(i)})^2}{2}

Motivated Meritocracy

Development Economics

November 21, 2024

A Model of (Context-Dependent) Inequality

The spectator seeks to maximize their utility from the distribution of resources:

 

If we assume there is no benefit from giving to a particular worker:

\max_{y_1} V_i^{k(i)} = X \theta_2 + y_1(\theta_1 - \theta_2) - \beta_i \frac{(y_1 - m^{k(i)})^2}{2}

Motivated Meritocracy

Development Economics

November 21, 2024

A Model of (Context-Dependent) Inequality

The spectator seeks to maximize their utility from the distribution of resources:

 

If we assume there is no benefit from giving to a particular worker:

\max_{y_1} V_i^{k(i)} =- \beta_i \frac{(y_1 - m^{k(i)})^2}{2}

This is the traditional model, solved by FOC:

0 =- \beta_i (y_1 - m^{k(i)}) \Rightarrow y_1 = m^{k(i)}

Motivated Meritocracy

Development Economics

November 21, 2024

A Model of (Context-Dependent) Inequality

This is the traditional model, solved by FOC:

0 =- \beta_i (y_1 - m^{k(i)}) \Rightarrow y_1 = m^{k(i)}

We can classify people by type given their redistribution choice:

m^{E(i)}=\frac{X}{2} \\
m^{M(i)}=\frac{a_1}{a_1+a_2}X
m^{L(i)}=\frac{a_1 p_1}{a_1 p_1+a_2 p_2}X

Egalitarian

Meritocrat

Libertarian

Motivated Meritocracy

Development Economics

November 21, 2024

A Model of (Context-Dependent) Inequality

The spectator seeks to maximize their utility from the distribution of resources:

\max_{y_1} V_i^{k(i)} = X \theta_2 + y_1(\theta_1 - \theta_2) - \beta_i \frac{(y_1 - m^{k(i)})^2}{2}

If we allow for some preference over who gets redistribution:

\theta_1 >0 \text{ and/or } \theta_2 >0 \text{ and } \theta_1 \neq \theta_2

Which yields FOC:

y_1^* = \frac{X(\theta_1 - \theta_2)}{\beta_i} + m^{k(i)}

Motivated Meritocracy

Development Economics

November 21, 2024

A Model of (Context-Dependent) Inequality

Which yields FOC:

y_1^* = \frac{X(\theta_1 - \theta_2)}{\beta_i} + m^{k(i)}

Then only allocate according to inequality preferences if spectator really cares about inequality preferences

\beta_i >> 0

Otherwise, bias towards one participant causes misrepresentation as a different type, which disguises the discrimination

Motivated Meritocracy

Development Economics

November 21, 2024

A Model of (Context-Dependent) Inequality

We need not allow for direct discrimination by providing the identity of the workers; it can be probabilistic:

y_1^* = \frac{X(\pi \theta_1 - (1-\pi)\theta_2)}{\beta_i} + m^{k(i)}

Potentially, the probability attenuates the bias based on inference.

However, it behaviorally provides more "cover" for discrimination under an inequality preference

Motivated Meritocracy

Development Economics

November 21, 2024

A Model of (Context-Dependent) Inequality

  • Key takeaways:
    • Under "blind" elicitations, spectator should always choose their personal optimal preference for inequality
    • Introducing any information about workers may bias the redistributive choice
      • Suddenly egalitarians look like meritocrats (or vice versa) when their choice benefits a certain type of worker
  • My argument henceforth
    • "Real" preferences (in the sense of policy) are made with knowledge and inference about who will benefit from redistribution schemes
    • It is vital to know if inequality preferences are stable or subject to the context of who benefits

Motivated Meritocracy

Development Economics

November 21, 2024

A Unique Context: Fiji

  • Island country in Melanesia north of New Zealand
  • Consists of 330 islands, with about 100 inhabited, most of the population (87%) lives on one of two islands

Motivated Meritocracy

Development Economics

November 21, 2024

A Unique Context: Fiji

  • 1874: Fiji as a British colony
  • A catastrophic measles outbreak (mortality rate of 540 out of 1000 workers) and rebellion led to limited labor force
  • Beginning in 1878, the UK began bringing indentured "laborers" from India to work, eventually over 60,000
  • Today, 35% of the population is Indo-Fijian, with 60% indigenous iTaukei

Motivated Meritocracy

Development Economics

November 21, 2024

A Unique Context: Fiji

  • Meanwhile "Fiji is for the Fijians" was adopted as official land ownership policy
    • Traditional chiefs granted control over governing
    • Most land could not be sold, only leased
  • Today, this land agreement remains in place: 90% of land belongs to iTaukei communal land-owning units
    • The majority of land is leased to farmers for agriculture
    • The rents are distributed hierarchically to iTaukei communities, though until 2023 they were uniformly paid

Motivated Meritocracy

Development Economics

November 21, 2024

A Unique Context: Fiji

  • Since independence in 1970, "Two Fijis" is the norm
    • iTaukei own land rights and receive rent payments
      • Redistributive scheme until last year was equal payments to the entire tribe
      • Now hierarchical, with only 70% evenly split
      • Often iTaukei do not work the land they own, or only subsistence farm on small percentages of it
    • Indo-Fijians largely comprise the cash crop production and urban business development
      • Not allowed to own land; pay rents to iTaukei
      • Generate considerable economic activity through land use
      • Lower poverty rate (20% vs 36%)

Motivated Meritocracy

Development Economics

November 21, 2024

A Unique Context: Fiji

  • Cultural differences are extremely prevalent (and salient):
    • iTaukei have a stronger social identity, in-group identification, and are more collectivistic than Indo-Fijians
    • Indo-Fijians have a much higher perceived socio-economic status than iTaukei
    • iTaukei more likely to be Christians, while Indo-Fijians more likely to be Hindus or Muslims
  • Geographic differences are also clearly defined:
    • iTaukei: native land under traditional clan structure
    • Indo-Fijian: urban centers and towns
    • The population share of Indo-Fijians is decreasing in distance from largest city, Suva
  • Political strength largely vested in iTaukei (esp. following 2000 coup), but economic strength with Indo-Fijians

Motivated Meritocracy

Development Economics

November 21, 2024

Hypotheses and Experimental Procedure

  • Standard spectator game (as in Almas, et al 2020)
  • Two experimental treatments:
    • Blind treatment - no information about the workers provided to the spectator
    • Geographical - location information about each worker, such that ethnic group of worker is readily inferred
  • Each with two sub-treatments for determining types:
    • Luck
    • Merit

 

 

 

 

 

 

Motivated Meritocracy

Development Economics

November 21, 2024

Hypotheses and Experimental Procedure

  • There are two key measures from the spectator game:                    
    1. The share of each type (as defined before)
    2. Implemented inequality:

 

 

 

 

 

 

 

 

e_i = \alpha + \alpha_M M_i + \delta T_i +\delta_M M_i T_i + \gamma X_i + \epsilon_i

where the outcome is equivalent to the GINI coefficient:

e_i = \frac{|\text{income } A_i - \text{income } B_i|}{\text{total income}}

Motivated Meritocracy

Development Economics

November 21, 2024

Hypothesis 1: the collectivist tradition of the iTaukei and the redistribution scheme for rents will lead to more egalitarian views

  • Hypothesis 1a: there is more inequality implementation by Indo-Fijian spectators than iTaukei spectators in blind treatments

 

  • Hypothesis 1b: there are fewer Indo-Fijian egalitarians than iTaukei egalitarians

 

 

Hypotheses and Experimental Procedure

(\delta > 0)

While not causal, this would provide further suggestive evidence along the lines of the differences observed between the United States and Norway

Motivated Meritocracy

Development Economics

November 21, 2024

Hypothesis 2: there are systematic shifts in inequality preferences towards the in-group in geographic treatment

 

  • Hypothesis 2a: when the in-group benefits from the initial payment scheme, fewer people choose to redistribute
  • Hypothesis 2b: when the in-group does not benefit from the initial payment scheme, more people choose to redistribute
  • Hypothesis 2c: conditioning on in-group performance, the distribution of types is not the same

Hypotheses and Experimental Procedure

e^b > e^g \Rightarrow \alpha_M^b > \alpha_M^g

Given blind (b) versus geographical (g) conditioning on in-group performing worse:

Motivated Meritocracy

Development Economics

November 21, 2024

Hypotheses and Experimental Procedure

Conditioning on in-group receiving initial payment

Motivated Meritocracy

Development Economics

November 21, 2024

Hypotheses and Experimental Procedure

Conditioning on in-group NOT receiving initial payment

Motivated Meritocracy

Development Economics

November 21, 2024

Hypotheses and Experimental Procedure

Conditioning on in-group NOT receiving initial payment

Motivated Meritocracy

Development Economics

November 21, 2024

Hypotheses and Experimental Procedure

Conditioning on in-group NOT receiving initial payment

Motivated Meritocracy

Development Economics

November 21, 2024

Additional Things I'm Thinking About

  • Adding a treatment with specific details about the workers to test direct pathway to in-group preference
  • Repeating the task within-subject to determine if spectators attenuate the bias shift in order to stay consistent
    • For example, going blind in first rounds to geographic in later rounds
    • Or, seeing the immediate beneficiaries of payment switch from in-group to out-group

Motivated Meritocracy

Development Economics

November 21, 2024

Conclusion

  • Understanding the stability of inequality preferences is important for a cohesive policy agenda
  • Redistributive policies can be an effective way to favor a group under veiled discrimination
  • Experimental procedure that uses an established paradigm and introduces an in- and out-group dimension with testable implications
  • Fiji offers a unique context in which to study:
    • History of different groups enjoying differing levels of political and economic power
    • Clear inference about worker type can be drawn with little exact revealed details