For their study “What determines perceived income justice? Evidence from the German TwinLife study” Selen Yildirim and Michael Neugart used data from the German twin study. 926 twins of the same sex, 57 percent of whom were identical, answered the question of whether they considered their current gross income in relation to their work to be fair, unfairly too high or unfairly too low. In the interview, Selen Yildirim talks about the results of the research.

We found that the genes contribute with more than 30 percent to the variation in people's perceived income justice. It was surprising that the remaining variation was associated with the non-shared environment, and the familial environment does not contribute to the variation at all. One would expect that parents attempt to mold their children’s preferences according to their own preferences. However, our results suggest that the common environment twins were raised in is not related to how they assess income equality.

We found an important contribution of genes to the assessment of income fairness. However, we should be careful about the interpretation. Our results only suggest that some people are more prone to assess their income as unfair regardless of whether they are high or low earners. We might only claim that there are “born fairness sensitive” people. Also, it should be noted that the remaining 70 percent of the variation are associated with the non-shared environmental factors. Meaning that although this preference is partly inherited via genes, the environment contributes to even larger part of the observed variation in the twins' answers on perceived income justice.

The fair wage hypothesis was introduced by George Akerlof in 1982 and George Akerlof and Janet Yellen in 1990. They relate the effort choices of workers to perceived fairness of their income. It is argued that people who perceive their income as unfair reduce their work-related effort. Their hypothesis has been strongly supported by experimental studies. Moreover, we know that income unfairness is not only related to effort choice but also to job quits and well-being of workers. It has been shown that workers who perceive their income as unfair are more likely to suffer from sleeping disorders, stress-related diseases and cardiovascular health problems.

It is a fair concern that having older people in our sample might lead to different results. What one observes in the literature is that the familial environment loses its importance over time and non-shared environment contributes more to the observed variation in people’s traits. We have zero contribution of familial environment, which is already the lower bound. In our study, we compare young people with other young people controlling for observable factors such as income. Thus, here is very likely no other reason but genetics why young monozygotic twin pairs are more likely to have the same assessments about their income fairness compared to young dizygotic twin pairs.

Questions by Silke Paradowski