Morten Nyborg Støstad
Lecturer at UC Berkeley, Spring '24
Post-doctoral Scholar at the FAIR Institute (NHH), Sept '23-25

Welcome to my personal website. I am currently a Lecturer at UC Berkeley (Spring '24) and a post-doctoral scholar at the FAIR Institute at the Norwegian School of Economics (NHH). I received my PhD in Economics from the Paris School of Economics in September 2023 and am a Fellow at the World Inequality Database.

My main research focus is inequality's societal effects, or the concept of inequality as an externality. I use theoretical and empirical methods to examine this and other subjects. 

Before Economics I studied Astrophysics, and published papers on the young stellar disk orbiting the super-massive black hole Sagittarius A* with a team of internationally renowned researchers. 

The Consequences of Inequality: Beliefs and Redistributive Preferences
Max Lobeck, Morten Nyborg Støstad
Full paper (Alternate link) -- Presentation slides

Abstract: What matters for individuals' preferences for redistribution? In this paper we show that consequentialist beliefs about inequality -- beliefs about how economic inequality changes the crime rate or the quality of democratic institutions, for example -- have a large causal impact on individuals' redistributive preferences. Using two representative surveys of a combined 6,731 U.S. citizens, we show that a majority of respondents believe that inequality leads to a wide range of negative societal outcomes. We establish a causal link from such beliefs to individuals' redistributive preferences by using exogenously provided video information treatments. With this and other methods we show that these "inequality externality beliefs" affect redistributive preferences on the same order of magnitude as broad economic fairness views. These beliefs also have various unique properties when compared to other determinants for redistributive preferences. As such, we discuss whether a focus on inequality's consequences could shape a distinct conversation about redistribution.

Inequality as an Externality: Consequences for Tax Design
Morten Nyborg Støstad, Frank Cowell (Journal of Public Economics #105139)
Full paper (Alternate link), Non-technical summary, Slides (UC Berkeley Public Finance seminar)

Abstract: Economic inequality may affect a wide range of societal outcomes, for example crime rates, economic growth, and political polarization. In this paper we discuss how to model such effects in welfarist frameworks. Our main suggestion is to treat economic inequality itself as an externality, which has wide-ranging implications for classical economic theory. We show this through the Mirrlees (1971) optimal non-linear income taxation model, where we focus on a post-tax income inequality externality. Optimal top marginal tax rates are particularly affected by the externality, implying a novel equality dimension to optimal top tax rate design. We propose that inequality's externality properties may have larger optimal top tax rate implications than standard revenue concerns; our model thus provides a theoretical basis for real-world governmental tax choices that seem irrational under standard optimal taxation models. We also show that the total inequality aversion implied by the current U.S. tax system is insufficient to accommodate both social welfare weights that are decreasing in income and a significant concern for inequality's externality effects.

Comparing Universes of Redistributive Arguments
Max Lobeck, Morten Nyborg Støstad
(Working paper coming soon)

Abstract: What are the properties of different types of redistributive arguments? We collect a large set of pro-redistribution arguments based on either fairness ideas or inequality's societal consequences and evaluate the average efficacy and emotional content of each type of argument. We collect arguments in a first survey, quality-check them in a second survey, and evaluate them in a third survey. This method allows us to evaluate an unbiased approximation of the "universe" of each type of argument. Our final data set has 32,300 argument evaluations across 160 redistributive arguments, 80 of each type. While both types of arguments are generally convincing, fairness arguments are relatively more convincing for low-income respondents. All respondents report significantly more anger in reaction to fairness arguments, which is largely driven by the average fairness argument having more emotional content.