Economic Inequality, Information, and Political Support for Public Goods

• In Event: Political Parties and American Democracy Mini-Conference I: Going Negative: How Information Affects Attitudes

Abstract

Economic inequality has steeply increased over the past four decades across the high-income, established democracies. The literature on public responses to inequality has tended to focus on whether inequality provokes demands for the state to do more by boosting redistribution. In this paper, we instead pursue the possibility that rising inequality undermines the popular foundations of state action. Building on findings in diverse literatures in political science, economics, and psychology, we hypothesize that one important effect of the steep rise in inequality may be to undermine support for public investment in costly public goods among the non-rich. We theorize that economic inequality may reduce lower- and middle-income citizens’ willingness to pay for public goods through three possible mechanisms: by changing evaluations of the fairness of the political-economic system in the broad sense (“system fairness”); by changing evaluations of the distributive fairness of the tax measures required to finance public goods (“policy fairness”); and by reducing the perceived likelihood that politicians will deliver promised public goods after taxes are paid (“political trust”). Via any of these mechanisms, citizens who receive or attend to information indicating that they are on the losing side of rising inequality would be expected to become less willing to pay higher taxes to finance additional public goods. We evaluate these conjectures through a series of online survey experiments, administered to large samples of voting-age citizens in the U.S., in which the key treatment is the presentation of information about rising inequality. While results vary to some degree across experiments, we find considerable evidence that providing and making salient information about rising concentrations of income at the top reduces non-rich respondents’ willingness to pay for public goods, and that it does so through our hypothesized system-fairness and political-trust mechanisms, with no evidence of the operation of a policy-fairness mechanism. The findings shed light on the nature of modern democratic states’ capacity to deliver collective goods that are foundational to social wellbeing and economic prosperity, while clarifying the political ramifications of rising inequality beyond the politics of redistribution.

Authors

• Timothy Hicks, University College London

• Alan M. Jacobs, University of British Columbia

• Scott Matthews, Memorial University