7 - Autonomy Freedom and Welfare Spending

Summary

INTRODUCTION

In Chapter 6 we demonstrated that the level of autonomy freedom enjoyed by individuals affects their attitudes toward inequality and, therefore, shapes their preferences for redistribution. More specifically, we argued that individuals form their tastes for income transfers out of a principle of procedural fairness based on the extent of autonomy freedom they possess. The higher an individual's level of autonomy freedom, the stronger her belief to be in control of her actions and their consequences, and the more accountable she feels as far as her income level is concerned. It follows that, whatever her economic status, she thinks that it is deserved. Therefore, for a highly autonomous individual, transfers are not just, even if to her benefit. The opposite applies for nonautonomous individuals. The lower an individual's level of autonomy freedom, the less she feels in control of her actions and their consequences, and the less accountable she is as far as her income level is concerned. Therefore, whatever her economic status, she thinks that it is not deserved. In this perspective, to a nonautonomous individual, transfers are necessary to compensate for unfairness in the income generation process.

In the present chapter we move from an analysis exclusively focussed on individual preferences for redistribution and income transfers to another that looks also at the determinants of actual social expenditure. Therefore, the objective of this chapter is to examine the relationship between autonomy freedom, individual preference for redistribution, and actual welfare spending.