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The Association Between Perceived Income Inequality and Subjective Well-being: Evidence from a Social Survey in Japan

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  • Takashi Oshio
  • Kunio Urakawa

Abstract

Previous 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 widening income inequality (as perceived income inequality), perceived happiness and SRH (as SWB), and household income and living standards compared with 1 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. Copyright Springer Science+Business Media Dordrecht 2014

Suggested Citation

  • Takashi Oshio & Kunio Urakawa, 2014. "The Association Between Perceived Income Inequality and Subjective Well-being: Evidence from a Social Survey in Japan," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 116(3), pages 755-770, May.
  • Handle: RePEc:spr:soinre:v:116:y:2014:i:3:p:755-770
    DOI: 10.1007/s11205-013-0323-x
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    2. Zheng Fang & Yoko Niimi, 2015. "Do Losses Bite More than Gains? Evidence from a Panel Quantile Regression Analysis of Subjective Well-being in Japan," Economic Growth Centre Working Paper Series 1507, Nanyang Technological University, School of Social Sciences, Economic Growth Centre.
    3. Jensen, Søren & Pedersen, Peder J., 2020. "Satisfaction with Life, Happiness, and Inequality – a Pseudo-Panel Study," IZA Discussion Papers 12972, Institute of Labor Economics (IZA).
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    7. Yoko Mimura, 2023. "Save Today for a Happier Tomorrow: Associations Between Happiness and Financial Preparation in Japan," Journal of Happiness Studies, Springer, vol. 24(3), pages 1261-1281, March.
    8. Jiaoli Cai & Li Zhang & Yulin Zhao & Peter C. Coyte, 2018. "Psychological Mechanisms Linking County-Level Income Inequality to Happiness in China," IJERPH, MDPI, vol. 15(12), pages 1-32, November.
    9. Fang, Zheng & Niimi, Yoko, 2017. "Does everyone exhibit loss aversion? Evidence from a panel quantile regression analysis of subjective well-being in Japan," Journal of the Japanese and International Economies, Elsevier, vol. 46(C), pages 79-90.
    10. Ichiro Sasaki & Katsunori Kondo & Naoki Kondo & Jun Aida & Hiroshi Ichikawa & Takashi Kusumi & Naoya Sueishi & Yuichi Imanaka, 2018. "Are pension types associated with happiness in Japanese older people?: JAGES cross-sectional study," PLOS ONE, Public Library of Science, vol. 13(5), pages 1-14, May.
    11. Yuri Sasaki & Yugo Shobugawa & Ikuma Nozaki & Daisuke Takagi & Yuiko Nagamine & Masafumi Funato & Yuki Chihara & Yuki Shirakura & Kay Thi Lwin & Poe Ei Zin & Thae Zarchi Bo & Tomofumi Sone & Hla Hla W, 2022. "Association between Happiness and Economic Status among Older Adults in Two Myanmar Regions," IJERPH, MDPI, vol. 19(6), pages 1-13, March.
    12. Hajdu, Tamás & Hajdu, Gábor, 2014. "Reduction of income inequality and subjective well-being in Europe," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 8, pages 1-29.
    13. Qiu Cheng & Kinglun Ngok, 2023. "Does the Dibao Program Improve Citizens’ Life Satisfaction in China? Perceptions of Pathways of Poverty Attribution and Income Inequality," Applied Research in Quality of Life, Springer;International Society for Quality-of-Life Studies, vol. 18(2), pages 975-995, April.
    14. Sun Youn Lee & Fumio Ohtake, 2021. "How Conscious Are You of Others? Further Evidence on Relative Income and Happiness," Journal of Happiness Studies, Springer, vol. 22(8), pages 3321-3356, December.
    15. Qin Zhou & Xuezheng Qin & Gordon G. Liu, 2020. "Relative economic status and mental health among Chinese adults: Evidence from the China health and retirement longitudinal study," Review of Development Economics, Wiley Blackwell, vol. 24(4), pages 1312-1332, November.
    16. Kubiszewski, Ida & Jarvis, Diane & Zakariyya, Nabeeh, 2019. "Spatial variations in contributors to life satisfaction: An Australian case study," Ecological Economics, Elsevier, vol. 164(C), pages 1-1.
    17. Gugushvili, Alexi & Reeves, Aaron, 2021. "How democracy alters our view of inequality — and what it means for our health," Social Science & Medicine, Elsevier, vol. 283(C).
    18. Punarjit Roychowdhury, 2018. "Visible consumption, relative deprivation, and health: evidence from a developing country," Economics Bulletin, AccessEcon, vol. 38(3), pages 1366-1380.
    19. Kate Sollis & Budy P. Resosudarmo & Firman Witoelar & Riswandi Riswandi & Julius A. Mollet, 2023. "Migrant Status and the Wellbeing Gap: The Case of an Ethnically Diverse, High-Conflict Area in Indonesia," Journal of Happiness Studies, Springer, vol. 24(5), pages 1781-1811, June.
    20. Teresa María García Muñoz & Juliette Milgram Baleix & Omar Odeh Odeh, 2022. "System Justification Beliefs and Life Satisfaction. The role of inequality aversion and support for redistribution," ThE Papers 22/15, Department of Economic Theory and Economic History of the University of Granada..
    21. Liang, Wanqi & Li, Wenying, 2023. "Impact of internet usage on the subjective well-being of urban and rural households: Evidence from Vietnam," Telecommunications Policy, Elsevier, vol. 47(3).
    22. Fabio Zagonari, 2016. "Which Attitudes Will Make us Individually and Socially Happier and Healthier? A Cross-Culture and Cross-Development Analytical Model," Journal of Happiness Studies, Springer, vol. 17(6), pages 2527-2554, December.
    23. Hideo Noda, 2020. "Work–Life Balance and Life Satisfaction in OECD Countries: A Cross-Sectional Analysis," Journal of Happiness Studies, Springer, vol. 21(4), pages 1325-1348, April.
    24. Quang Tran, Tuyen & Viet Nguyen, Cuong & Van Vu, Huong, 2015. "Economic Inequality and Happiness: A quantitative study among the elderly in Rural Vietnam," MPRA Paper 81235, University Library of Munich, Germany, revised 14 Oct 2016.

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