Record Income Inequality Isn't Just Unfair, It Makes Us Less Happy Too

new york stock exchange
photo: David Blaikie/CC BY 2.0

Hopefully by now you're aware that income inequality in the United States is at levels unseen since the age of the Robber Barons over a century ago. Recent stats show that when that breaks down along racial lines the situation becomes starker still. What does all that mean to people's happiness?

A new study to be published in Psychological Science, being highlighted by Greater Good, shows that for the increasing number of have-nots in the US it means a noted decrease in happiness. And it's not just because of economic hardship.
The study found that for those people in the bottom 40% of income, increases in income inequality tracked with decreases in happiness. Outside of that income bracket there was no such correlation.

Greater Good explains the more complex part:

People weren't unhappy just because their income was lower. Instead, the authors' analysis revealed that greater inequality was linked to reductions in trust and perceived fairness--and it was drops in those attitudes that made people feel less happy.

In the study, Oishi and his colleagues argue that their results may explain why economic growth has not been accompanied by increases in happiness in the United States, unlike in other developed nations. The problem, they suggest, is that gains in national wealth in the U.S. haven't been distributed equally, and this inequality has caused Americans' happiness to suffer.

As for the environmental angle: Remember that both conspicuous consumerism and increased consumption of resources often go hand in hand with that small group of people getting more and more of the nation's wealth, and for the bottom part of the income bracket less and less wealth means there are likely greater immediate concerns than good environmental stewardship. Also remember that poorer neighborhoods are often given the shaft when it comes to placement of polluting industry, access to quality food, social services. Nothing good comes from radically unbalanced income distribution.

More on Happiness
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Tags: Economics


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