The association between perceived income inequality and subjective well-being: Evidence from a social survey in Japan
AbstractPrevious studies have shown that income inequality in society is negatively associated with individuals’ subjective well-being (SWB), such as their perceived happiness and self-rated health (SRH). However, it is not realistic to assume that individuals have precise information about actual income distribution measured by the Gini coefficient or other statistical measures. In the current study, we examined how perceived income inequality, rather than actual inequality, was associated with SWB, using cross-sectional data collected from a nationwide, Internet survey conducted in Japan (N = 10,432). We also examined how this association was confounded by individuals’ objective and subjective income status, considering the possibility that individuals with lower income status are more inclined to both perceive income inequality and feel unhappy/unhealthy. In our analysis, we focused on the perception of a widening income inequality (as perceived income inequality), perceived happiness and SRH (as SWB), and household income and living standards compared with one year ago and compared with others (as income status). We also controlled for personality traits. We obtained three key findings: (1) perceived income inequality was negatively associated with SWB; (2) both perceived income inequality and SWB were associated with income status; and (3) the association between perceived income inequality and SWB was attenuated after controlling for income status, but not fully for perceived happiness. These findings suggest that perceived income inequality, which links actual income inequality to SWB, should be further studied.
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Bibliographic InfoPaper provided by Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University in its series CIS Discussion paper series with number 579.
Length: 27 p.
Date of creation: Jan 2013
Date of revision:
income status; perceived income inequality; personality traits; self-rated health; subjective well-being;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-02-03 (All new papers)
- NEP-LTV-2013-02-03 (Unemployment, Inequality & Poverty)
- NEP-PBE-2013-02-03 (Public Economics)
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