Countries with high inequality and belief in luck and connections tend to support high taxes and generous welfare states. Contrary to common belief, large welfare states and redistribution do not necessarily harm the economy. Conditional benefits, relative income concerns, correcting for consumer rivalry, and addressing market distortions can actually boost employment and economic performance. Additionally, increasing tax progression in non-competitive labor markets can lead to wage moderation and further employment growth. Large welfare states often implement pro-growth policies, contributing to overall economic well-being.