Openness to wealth along with penalties for financial secrecy can create more fair societies

A new study discovered that the richest individuals contribute more to the public good when they are forced to transparently about their wealth – especially when they can be punished for financial confidentiality.

Imported to what they describe as a “worrying rise” in economic inequality, a group of economists began to study how transparency and sanctions can face negative effects of inequality on social cooperation.

They have designed experiences using a good general game, which are used in the economy to explore the factors that affect cooperation, in which groups of four profits decided to contribute to a common container.

Experiments simulate cooperation in the workplace, with income differences either from individual skill alone or from a mixture of skill and luck, and with players sometimes punishing low shareholders.

In the first experiment, the existing income gaps grew over time with the players who were called to be ready to pay to hide the edge based on luck, and the peer punishment for low contributions to the common bowl that failed to slow down increased inequality.

In the second experiment, the researchers found that making everyone publicly publicly increased the strength of the punishment in promoting contributions – especially among the players who were deduced – while transparency without a punishment had no effect on cooperation.

“The financial secrecy leads to exacerbation of inequality by enabling the wealthy and companies to hide their wealth, which we see through tools such as non -detection agreements and hidden wage standards that divide employees and intensify the negative effects of inequality,” said Dr. Jingan Chen of Exter Business University.

“Our study provides a clear and strong vision: openness about wealth encourages fairness and cooperation-especially when the rules of rules can be considered.”

The researchers say the results have far -reaching effects on a group of corporate issues, from the executive payment secrecy to avoid corporate tax.

Dr. Chen said: “The ability to hide wealth can deepen inequality and erosion of trust. But with transparency and accountability, organizations and societies – enhance more fairness and social responsibility,” said Dr. Chen.

“Enhancing cooperation in an unequal world: an experimental guide to the role of transparency and punishment Published in Work Ethics Magazine.