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GINI DP 20: Does Income Inequality Negatively Affect General Trust? Examining three potential problems with the inequality-trust hypothesis

Author

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  • Sander Steijn

    (AISSR, University of Amsterdam)

  • Bram Lancee

    (Research unit Migration, Integration, Transnationalization, Social Science Research Center Berlin (WZB))

Abstract

Many studies on the consequences of income inequality find that where inequality is high, trust is low. There are, however, reasons to examine the relation between inequality and trust more closely. First, previous research does not differentiate between the effect of income inequality and that of national wealth. Furthermore, the underlying mechanism is often unclear. Finally, the association might be dependent on non-Western countries where income inequality is extremely high. In this paper, we evaluate whether there is a relation between income inequality and trust in a sample of Western developed economies when taking into account national wealth. Theoretically, we distinguish between stratification effects and perception effects of inequality. Empirically, besides actual income inequality and national wealth, we include a measurement of perceived inequality on the basis of individual level earnings estimations for stereotypical jobs. We find no significant effect of inequality on trust when taking into account national wealth, suggesting that in Western countries the amount of resources rather than its distribution explains trust. Key words: trust, income inequality, perceived inequality, national wealth, comparative research.

Suggested Citation

  • Sander Steijn & Bram Lancee, 2011. "GINI DP 20: Does Income Inequality Negatively Affect General Trust? Examining three potential problems with the inequality-trust hypothesis," GINI Discussion Papers 20, AIAS, Amsterdam Institute for Advanced Labour Studies.
    • Handle: RePEc:aia:ginidp:20
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    References listed on IDEAS

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    Cited by:

    1. Wiemer Salverda & Christina Haas & Marloes Graaf-zijl & Bram Lancee & Natascha Notten & Tahnee Ooms, 2013. "GINI Country Report: Growing Inequalities and their Impacts in the Netherlands," GINI Country Reports netherlands, AIAS, Amsterdam Institute for Advanced Labour Studies.
    2. Clark, Andrew E. & D'Ambrosio, Conchita, 2014. "Attitudes to Income Inequality: Experimental and Survey Evidence," IZA Discussion Papers 8136, Institute of Labor Economics (IZA).
    3. Javier Olivera, 2013. "On changes in general trust in Europe," Working Papers 201301, Geary Institute, University College Dublin.
    4. Javier Olivera, 2015. "Changes in Inequality and Generalized Trust in Europe," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 124(1), pages 21-41, October.
    5. Johan Graafland & Bjorn Lous, 2018. "Economic Freedom, Income Inequality and Life Satisfaction in OECD Countries," Journal of Happiness Studies, Springer, vol. 19(7), pages 2071-2093, October.
    6. Olivera, J., 2013. "GINI DP 80: On changes in general trust in Europe," GINI Discussion Papers 80, AIAS, Amsterdam Institute for Advanced Labour Studies.
    7. Johan Graafland & Bjorn Lous, 2019. "Income Inequality, Life Satisfaction Inequality and Trust: A Cross Country Panel Analysis," Journal of Happiness Studies, Springer, vol. 20(6), pages 1717-1737, August.
    8. Katarzyna Samson, 2018. "Trust as a mechanism of system justification," PLOS ONE, Public Library of Science, vol. 13(10), pages 1-22, October.
    9. Yunsoo Lee, 2021. "Government for Leaving No One Behind: Social Equity in Public Administration and Trust in Government," SAGE Open, , vol. 11(3), pages 21582440211, July.

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