As I noted in Monday's post, this week my ECONS102 class covered inequality, and the potential negative externalities associated with inequality. One of those negative externalities relates to social segregation. Greater inequality leads to greater geographical segregation between social groups (e.g. think about gated communities, or trailer parks). In turn, that means fewer interactions between class groups, leading to lower sympathy for lower-class groups among upper-class groups, making those with power more accepting of increased inequality for future generations. So, the negative externality here is intergenerational - greater inequality today potentially leads to even greater future inequality.
However, let's take a step back. What evidence is there that inequality leads to lower sympathy for lower-class groups among upper-class groups? That question is addressed, in part, in this recent article by Hyunjin Koo, Paul Piff (both University of California, Irvine), and Azim Shariff (University of British Columbia), published in the journal Social Psychological and Personality Science (open access). They ran a pair of studies comparing attitudes towards the poor, between people who became rich and people who were born rich. They hypothesised that:
...the Became Rich would perceive it less difficult to improve one’s SES [socio-economic status] than the Born Rich. We further predicted that beliefs about the difficulty of upward social mobility would predict a variety of sympathetic attitudes toward the poor, including empathy for the poor, attributions for poverty, belief that the poor are sacrificing to improve their SES, and support for redistribution...
In the first study, they had 479 participants aged 25 years or older:
...whose 2019 household pretax income was more than US$80,000, and who responded that their current social class is ‘‘upper-middle class’’ or ‘‘upper class.’’
In the second study, they had 553 participants with pretax household income in the top quintile of the US household income distribution (more than US$142,501). In both studies, after controlling for race, age, and gender, they found that:
...the Became Rich thought it less difficult to improve one’s socioeconomic conditions than the Born Rich, views that were negatively linked to redistribution support and various sympathetic attitudes toward the poor.
That doesn't quite answer the question we started with. However, it does provide some evidence that, in a time of increasing inequality (as experienced in the US over the last two decades especially), those who have become newly rich, have lower sympathy towards those left behind with lower incomes. Of course, it may simply be that those who are less sympathetic to begin with are more likely to experience upward social mobility, and we cannot discount that.
However, a third study reported in the paper might help us to discount the latter possibility. Based on a sample of 492 research participants recruited using Turkprime Panels, Koo et al. randomly assigned participants:
...to one of two conditions: upward mobility or stationary high. In both conditions, we asked participants to imagine that 15 years ago, right after graduating from university, they started working at a big family-owned company. The company is being run by a CEO who began their work as a low-level employee at the company, implying that upward mobility is possible in both conditions. In the stationary high condition, participants were told that the company belongs to their family, and as such, they were hired as a Senior Vice President from the start and have held that position since. On the contrary, those in the upward mobility condition were instructed to imagine having begun as an ordinary employee but made their way up to Senior Vice President during the past years. Participants were then asked to evaluate Pat, an unsuccessful employee who started working at the company around the same time but remained in the same low position despite their years there...
Comparing the responses of the participants in each condition, Koo et al. found that:
...those induced to feel that they had moved up within an organization (vs. having a stationary high position) thought it less difficult to improve one’s position in the company, which in turn predicted reduced sympathetic attitudes toward others struggling to move up.
Koo et al. argue that this provides causal evidence. I think it probably falls short of that standard, being based on self-reported responses to a hypothetical scenario. However, it does provide some stronger evidence on what a change in social status might do to higher-status people's sympathy towards lower-status people. This provides a modicum of further support for the earlier contention that inequality leads to lower sympathy for lower-class groups among upper-class groups.
The Koo et al. article also shows that their results would be unexpected to most people. In two other studies, they found that that people in general expect the Became Rich to hold more sympathetic attitudes toward the poor than the Born Rich (but of course the opposite is what they found). Clearly, this is an area where more research, and potentially some experimental research, could be of value.
[HT: The Dangerous Economist]
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