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Home»Business»Finance
Finance

The Impact of Zero-Sum Thinking on Perceptions of Taxes

April 20, 2024No Comments3 Mins Read
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The way people think about the world as either zero-sum or not has a significant impact on their beliefs about taxes, immigration, universal healthcare, affirmative action, and other policy choices. New research conducted by Harvard, the London School of Economics, and the University of British Columbia surveyed over 20,000 US residents to understand these relationships. The study found that the zero-sum view is correlated with factors such as race, age, family history of scarcity, income, education, and political party, making the connections more complex than previously thought.

The study revealed that individuals with higher incomes and graduate degrees often hold a zero-sum view and support government policies to redistribute income, even if it means paying higher taxes. On the other hand, populations that benefit economically from government redistribution, such as White, rural, and older individuals, tend to oppose these policies. While Democrats typically align with a more zero-sum mindset and support progressive policies, there is a wide range of views within both parties, with many Republicans also favoring economic redistribution, such as raising taxes on high-income households.

The research also sheds light on how a zero-sum mentality may have influenced past elections, with some voters shifting their support based on candidates who speak in zero-sum terms. For instance, the study found that a significant number of voters who supported Barack Obama and Bernie Sanders later voted for Donald Trump in 2016, particularly those who strongly adhere to a zero-sum worldview. Trump’s perceived zero-sum rhetoric resonated with voters who shared this mindset, regardless of party affiliation.

The authors of the study suggest that a zero-sum mindset can stem from a desire to correct past injustices or procedural unfairness, which may explain why some groups, such as Black Americans, lower-income individuals, and younger respondents, tend to hold stronger beliefs in a zero-sum world. However, those who have experienced economic mobility, including immigrants and those who grew up in immigrant communities, are less likely to see the world in a zero-sum way.

The implications of this research are significant for both politics and policy, indicating the possibility of building coalitions that support progressive tax policies while also implementing restrictions on immigration. The study found that nearly 80 percent of respondents would support raising taxes on high-income families to fund programs that help low-income families, with those who hold zero-sum beliefs more likely to back the petition. Overall, the study highlights the complex relationship between worldviews, policy preferences, and political affiliations, suggesting that individuals’ beliefs about the world shape their perspectives on a wide range of policy issues.

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