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Attitudinal Effects of Income Inequality: Cross-national and Experimental Evidence

Aina Gallego
Institut Barcelona d'Estudis Internacionals – IBEI
Aina Gallego
Institut Barcelona d'Estudis Internacionals – IBEI

This paper argues that income inequality impairs the ability of the poor to overcome collective action problems and mobilize politically. A large literature has claimed that income inequality erodes interpersonal trust. While previous research has not studied heterogeneous effects, this erosion may be deeper among certain income groups. The paper argues that inequality reduces trust among the poor, while no such effect exists for richer citizens. Assuming, as a large literature suggests, that trust facilitates cooperation and helps solve social dilemma, a reduction in trust among the poor will undermine their ability to organize politically and demand redistribution.

The empirical analyses use both experimental and observational data. I draw on cross-national surveys to describe levels of interpersonal trust across income groups in countries with different levels of income inequality. However, severe identification problems hinder the assessment of the effects of inequality using observational data. In order to test the claim that inequality decreases trust disproportionately among the poor, the paper employs an experiment that subtly manipulates perceptions of income inequality in a survey context. The manipulation was embedded in a representative survey of Dutch respondents (Longitudinal Internet Study for the Social Sciences) conducted in 2011. Respondents were asked to report their income level using a question that modified the income brackets to alter perceptions of income inequality in the Netherlands. The control group was administered no income question. After this, the survey asked respondents about interpersonal trust and their willingness to cooperate with others.

The results confirm that income inequality reduces pro-social attitudes among the poor, but not among the rich. This finding suggests that inequality may create a trap by disproportionately depressing the attitudes that facilitate collective action among the poor, thus making it harder for them to organize politically.
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