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Perceived wage inequality, demand for wage equalization, and life satisfaction

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  • Hajdu, Gábor

Abstract

This paper analyzes the relationship between perceived wage inequality, demand for wage equalization and life satisfaction. Using the large dataset of the Hungarian Microcensus of 2016 and a measure that quantifies perceived inequality based on respondents' wage estimates - rather than based on normative or attitudinal views or policy preferences, which are widely used in the literature - I find that individuals who perceive higher wage inequality and those who demand greater wage equalization tend to report lower life satisfaction. Furthermore, I show that the negative association between perceived wage inequality and life satisfaction is stronger among those who demand greater wage equalization. The results suggest that the association between perceived wage inequality and satisfaction is stronger for low SES respondents than for high SES respondents, but the latter appear to be more aware of the unfairness in income distribution.

Suggested Citation

  • Hajdu, Gábor, 2024. "Perceived wage inequality, demand for wage equalization, and life satisfaction," GLO Discussion Paper Series 1544, Global Labor Organization (GLO).
    • Handle: RePEc:zbw:glodps:1544
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    References listed on IDEAS

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    1. Stephen Jenkins, 2015. "World income inequality databases: an assessment of WIID and SWIID," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 13(4), pages 629-671, December.
    2. 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.
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    More about this item

    Keywords

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    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

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