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Judith Niehues IW-Trends No. 1 2. April 2019 Subjective Redistribution Preferences in Germany: Popular Will and Political Reality

Survey data suggest that a majority of Germans want the government to reduce income disparities. This subjective preference for redistribution has increased markedly in the past decade, regardless of the actual development of distribution ratios, which have hardly changed since 2005.

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Popular Will and Political Reality
Judith Niehues IW-Trends No. 1 2. April 2019

Subjective Redistribution Preferences in Germany: Popular Will and Political Reality

IW-Trends

German Economic Institute (IW) German Economic Institute (IW)

Survey data suggest that a majority of Germans want the government to reduce income disparities. This subjective preference for redistribution has increased markedly in the past decade, regardless of the actual development of distribution ratios, which have hardly changed since 2005.

Germany is by no means the only country in which the majority of citizens hold the state responsible for reducing the income gap between rich and poor. Yet in Germany this desire for equality is above the rich-country average, even though few OECD countries actually achieve a greater level of redistribution through government levies and transfers. A detailed examination of redistribution preferences reveals little interest in expanding expenditure expressly designed to benefit less privileged groups. Where taxes are concerned, the broad population favours a greater degree of progression. However, furthr survey results suggest that the redistributive effect already achieved by the income tax system is considerably underestimated. At the same time, polls indicate a marked preference for recognisable income differences as long as they are seen to be justified by performance. It would therefore make sense, while not ignoring conventional inequality indicators, to focus more closely on measures of equality of opportunity and rewards for performance, as this would make clearer whether the policies implemented really address the perceived deficits in fairness that interest voters.

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Popular Will and Political Reality
Judith Niehues IW-Trends No. 1 2. April 2019

Judith Niehues: Subjektive Umverteilungspräferenzen in Deutschland – Wunsch und Wirklichkeit

IW-Trends

German Economic Institute (IW) German Economic Institute (IW)

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Rising social security contributions weigh on competitiveness
Michael Hüther / Thomas Obst / Jochen Pimpertz IW-Policy Paper No. 3 23. January 2025

Rising social security contributions weigh on competitiveness

Germany is suffering from a loss of international competitiveness. Revitalising economic growth therefore not only requires a sustainable change of economic policy. Even in the short term, measures must be taken to revitalise public and private investment in ...

IW

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Markus Demary / Tobias Hentze / Jasmina Kirchhoff / Michael Voigtländer IW-Policy Paper No. 2 22. January 2025

An agenda for more private investment

Germany has a massive lack of investment, which dampens productivity, thereby reducing economic growth and increasingly endangering prosperity.

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