Title: Relative (dis)Advantage. Perspectives from the “Right” Tail
Even though research by economists has demonstrated that the wealthiest 1 percent are increasing their advantage over others, there is little empirical research regarding how they perceive increasing economic inequality (see Chin, 2014; whose work is a notable exception and Page et al., 2013). In my presentation, I present findings from a mixed-methods doctoral study with 30 UK-based participants who are situated at the (very) top of the income and(/or) wealth distributions. Attitudes expressed by respondents in semi-structured interviews are compared with nationally representative findings from the British Social Attitudes (BSA) survey.
A characteristic of income and wealth distributions is that they have a positive skew, with long right-hand tails which keep expanding. Individuals situated at the ‘right’ tail of the distribution are expected to be in social contact with, or have awareness of, others who are likewise situated at the top. The absolute differences between top income earners, defined as the top 1 percent of the distribution (see Piketty, 2014), are much higher than those between individuals situated at the middle of distribution. Hence, in their daily lives top income earners are surrounded by vast absolute income inequality (see also Khan, 2015). As Savage (2014, p. 602) argues, we need to explore “this internal demarcation and differentiation of the very privileged”. I argue that it is precisely the economic inequality between those at the top and the social comparisons which individuals make, which is important for understanding how economic inequality is experienced by this group. It is hypothesized that in contrast to Runciman's (1966) survey of the general population, ‘relative inequality’ (based on ‘relative deprivation’) is felt by those at the top of the economic distributions, as their comparative reference group is vastly different in economic terms from their economic membership group.
The thematic analysis of the interview and survey data shows that participants experience what I term relative (dis)advantage at the ‘right’ tail. Participants draw upon wide-ranging social comparisons when discussing their subjective social status. A key reference group which respondents refer to includes so-called self-made entrepreneurs, in particular Bill Gates, reminiscent of "the moral hierarchy of wealth" (Piketty, 2014, p.444). There is awareness of advantage compared with the general population, but participants also experience disadvantage or ‘relative inequality’ when ‘looking up’ (Khan, 2015) to others who are wealthier or have achieved greater economic success. They are also acutely aware of the skew of the distribution, but profess that the experience of disadvantage is generally positive. Economic inequality (and in particular, top incomes and wealth) is legitimized through the cultural process of rationalization (Lamont et al., 2014) and in particular evaluation based on financial value. During the interviews, relative (dis)advantage was discussed as being a positive driver, a motivator to do better economically, and a contributor to creating wealth and jobs. Hence, for some participants, economic inequality was seen as a neutral market outcome and not as a policy issue that needs to be addressed.
To explore how economic inequality is understood, I asked participants in turn how high they think top income and wealth shares are in the UK, and how high they think they ought to be, respectively. Many participants believe that ‘the market’ should determine levels of economic inequality (hence assert that they cannot answer this question) and that income inequality is justified for 'meritocratic' (Piketty, 2014) reasons. The data show that those participants who critically engage with the moral question how high top incomes and wealth shares should be are more likely to strongly agree or agree that it is the government’s responsibility to reduce income differences between the rich and the poor.
Bibliography
Chin, F. (2014) What the Wealthy Know and Believe About Economic Inequality. In: Understanding Whether and How Economic Inequality Affects Economic Growth. Washington Centre for Equitable Growth.
Khan, S. R. (2015) ‘The Counter-Cyclical Character of the Elite’. In Elites on Trial, Emerald Group Publishing Limited, pp. 81–103.
Lamont, M., Beljean, S. and Clair, M. (2014) ‘What Is Missing? Cultural Processes and Causal Pathways to Inequality’, Socio-Economic Review, 12, 573–608.
Laurison, D. (2015) The Right to Speak: Differences in Political Engagement among the British Elite’, The Sociological Review, 63, 349–372.
Page, B. I., Bartels, L. M. and Seawright, J. (2013) ‘Democracy and the Policy Preferences of Wealthy Americans’, Perspectives on Politics, 11, 51–73.
Piketty, T. (2014) Capital in the Twenty-First Century, Cambridge, Massachusetts, The Belknap Press of Harvard University Press.
Piketty, T. (2015) ‘Putting Distribution Back at the Center of Economics: Reflections on Capital in the Twenty-First Century’, Journal of Economic Perspectives, 29, 67–88.
Runciman, W. G. (1966) Relative Deprivation and Social Justice : A Study of Attitudes to Social Inequality in Twentieth-Century England, London, Routledge & Kegan Paul.
Savage, M. (2014) ‘Piketty’s Challenge for Sociology: Piketty’s Challenge for Sociology’, The British Journal of Sociology, 65, 591–606.
1)Referring to participants’ responses to the British Social Attitudes (BSA) questions relating "government’s responsibility to reduce income differences between the rich and the poor”, and “government should redistribute income from the better-off to those who are less well off”.