GINI DP 20: Does Income Inequality Negatively Affect General Trust? Examining three potential problems with the inequality-trust hypothesis
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.
|Date of creation:||Nov 2011|
|Contact details of provider:|| Postal: Nieuwe Prinsengracht 130, 1018 VZ Amsterdam|
Web page: http://www.uva-aias.net
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Gustavsson, Magnus & Jordahl, Henrik, 2006.
"Inequality and Trust in Sweden: Some Inequalities are More Harmful than Others,"
Working Paper Series
673, Research Institute of Industrial Economics.
- Gustavsson, Magnus & Jordahl, Henrik, 2006. "Inequality and Trust in Sweden: Some Inequalities are More Harmful than Others," Ratio Working Papers 106, The Ratio Institute.
- Jordahl, Henrik, 2007. "Inequality and Trust," Working Paper Series 715, Research Institute of Industrial Economics.
- Alberto Alesina & Eliana La Ferrara, 2000. "Participation in Heterogeneous Communities," The Quarterly Journal of Economics, Oxford University Press, vol. 115(3), pages 847-904.
- Alberto Alesina & Eliana La Ferrara, "undated". "Participation in Heterogeneous Communities," Working Papers 151, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
- La Ferrara, Eliana & Alesina, Alberto, 2000. "Participation in Heterogeneous Communities," Scholarly Articles 4551796, Harvard University Department of Economics.
- Alberto Alesina & Eliana La Ferrara, 1999. "Participation in Heterogeneous Communities," NBER Working Papers 7155, National Bureau of Economic Research, Inc.
- Gustavsson, Magnus & Jordahl, Henrik, 2006. "Inequality and Trust: Some Inequalities are More Harmful than Others," Working Paper Series 2006:3, Uppsala University, Department of Economics.
- Delhey, Jan & Newton, Kenneth, 2002. "Who trusts? The origins of social trust in seven nations," Discussion Papers, Research Unit: Social Structure and Social Reporting FS III 02-402, Social Science Research Center Berlin (WZB).
- Andrew Leigh, 2006. "Trust, Inequality and Ethnic Heterogeneity," The Economic Record, The Economic Society of Australia, vol. 82(258), pages 268-280, 09.
- Brown, Malcolm C., 1994. "Using gini-style indices to evaluate the spatial patterns of health practitioners: Theoretical considerations and an application based on Alberta data," Social Science & Medicine, Elsevier, vol. 38(9), pages 1243-1256, May.
- Alesina, Alberto F & La Ferrara, Eliana, 2000. "Who Trusts Others?," CEPR Discussion Papers 2646, C.E.P.R. Discussion Papers.
- Delhey, Jan & Newton, Kenneth, 2004. "Social trust: Global pattern or nordic exceptionalism?," Discussion Papers, Research Unit: Inequality and Social Integration SP I 2004-202, Social Science Research Center Berlin (WZB). Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:aia:ginidp:20. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiemer Salverda)
If references are entirely missing, you can add them using this form.