It has been found that a large fraction of people is overconfident. Such people consider their income is low compared with the self-evaluation of their ability. How does this gap affect preferences for redistribution? Theoretically, people attribute this gap to either the lack of their ability or the unfairness of the society: realizing the income-ability gap lowers both the self-perception of their ability and the trust toward the government because the gap indicates that the government has not taken appropriate actions to make the society fair. The former (resp. the latter) is expected to increase (resp. decrease) the support for redistribution. Although recent two studies examine the effect of overconfidence on social preferences in laboratory experiments (Deffains et al. 2016, Ng and Semenov 2019), their focus is on neither updating about the ability nor political trust.

After developing the formal theory of these two distinctive effects, we conduct a survey experiment in the U.S. with roughly 2000 participants. At the beginning of the survey, respondents are asked to tell their income and self-evaluation on their ability, which give us their self-perception of income-ability gap. Then, respondents are randomly assigned to the treatment that emphasizes the income-ability gap constructed by their previous answers. By looking at the treatment effect on the perceived degree of ability, the trust toward the US government, and the preferences for redistribution, we uncover how realizing the income-ability gap changes the preferences for redistribution.