What Determines Perceived Income Justice? Evidence from the German TwinLife Study

Abstract

Whether individuals perceive their income as being fair has far-reaching consequences in the labor market and beyond. Yet we know little about the determinants of variation in perceived income justice across individuals. In this paper, we ask to what extent differences in genes are related to variation in individuals' perceived income justice, and whether there is a gene-environment component. Analyzing data from the German TwinLife study, we find that more than 30% of individuals' perceived income justice can be attributed to genes. The rest is mostly related to an idiosyncratic environment.