How do perceived changes in inequality affect health?

Abstract

Individuals do not possess an entirely accurate assessment of the level of income differences in their society and so changes in quantitative measures of income inequality may not always align with changes in the perceptions of income inequality. This disconnect is partly driven by how people form their opinions about the level of inequality. In this study we explore whether there is an association between perceptions of inequality and health, and if so, how it differs depending on the specific channel through which people formed their opinions about changes in income inequality. Drawing on data from 31 European and Eurasian countries, we find that both men and women are more likely to report bad health when their perceptions of increasing inequality are formed through experiences of inequality in their communities than through media and other channels.

Keywords: Income inequality; Multilevel analysis; Perceptions of inequality; Self-reported health; Treatment-effects estimation.