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We measure preferences for earnings redistribution across eight small villages of horticulturalists in the island of Bougainville, Papua New Guinea. Villages have varying degrees of proximity with the market town in the island. Triads of participants – two 鈥渟takeholders鈥� and a 鈥渟pectator鈥� - were involved in anonymous experiments of distribution of earnings. The stakeholder who either turned out to be luckier in an unbiased random procedure (Luck treatment) or more able in a game of ability (Merit treatment) was assigned a higher sum of money as initial earnings. The other stakeholder was assigned a lower sum of money. Both stakeholders were asked to propose a division of the total sum of money among themselves. The spectators were also asked to propose a division of money between the stakeholders, even if the stakeholders鈥� payoff was fixed in advance. One of the three proposals would be randomly selected and implemented to determine final earnings. In an additional treatment, stakeholders鈥� decisions were observed by village leaders. In this way we can disentangle the relevance of selfishness, inequality aversion, propensity to reward merit, and social norms on individual preferences for redistribution.

We find that: (1) The closer a village to the market town, the higher the selfishness of participants in demanding more money for themselves, and the higher the propensity of stakeholders to assign more money to the luckier / more able stakeholder; (2) Behaviour across villages is nonetheless variable. Egalitarianism is widespread in most isolated villages. Participants from villages at intermediate levels of proximity with the market town, instead, appear to tolerate inequality in that many less lucky / less able stakeholders assign more money to the luckier / more able participant; (3) No propensity for meritocracy – i.e. rewarding more the more able than the luckier stakeholder – can be found; (4) The presence of the observer has a moderate effect in inducing luckier / more able stakeholders to demand less money for themselves.

These results suggest some speculative conclusions. Greater integration with markets may have a key role in shaping inequality aversion. Meritocracy is not a 鈥減sychological universal鈥� but rather a propensity that may be typical of economically more developed societies.