How does economic inequality change society?

How do we believe economic inequality changes society – through for example the amount of crime or the quality of democratic institutions? And do our beliefs in these consequences of inequality affect how much we want to redistribute?

Using two representative surveys of a combined 6,731 U.S. citizens, Max Lobeck and Morten Nyborg Støstad create the first database of beliefs about inequality’s consequences. They then connect these beliefs to people’s willingness to redistribute. The results indicate that these efficiency-based concerns could represent a different way of talking about redistribution.

Key findings:

• U.S. citizens believe that inequality leads to a wide range of negative societal outcomes. For example,
  • • 74% believe economic inequality increases the amount of crime,
    • 57% believe it worsens the functioning of democratic institutions,
    • and only 23% believe that economic inequality improves economic growth.
• Learning about the consequences of inequality increases individuals’ preferences for redistribution.
• Unlike broad fairness concerns, beliefs about inequality’s consequences are relatively similar across incomes and political affiliation.

AUTHORS

• Max Lobeck, Federal Ministry of Economics and Climate Action, Germany
• Morten Nyborg Støstad, FAIR Institute, NHH Norwegian School of Economics

MEDIA CONTACT

•  press@wid.world