OECD studies people’s perceptions of inequality to improve chances for reform

While income inequality has increased in many countries over the past 30 years, gathering public support to sustain momentum for reforms that address those inequalities is important, especially in recovering from the pandemic, says a recent report from the Organisation for Economic Cooperation and Development (OECD). To gain wider public support to address inequality, the report finds that governments should work toward a better understanding of public perceptions of inequality and provide better information on inequality and equality of opportunities.

The report looks at how people’s perceptions of inequality and social mobility impact their support for such reforms, concluding that while there is growing consensus that inequality is a problem, divisions about its extent and what to do about it are also increasing.

The report reveals that people’s perceptions of inequality are strongly correlated with real-life evidence of economic inequality, whether or not perceptions are accurate or if people have a full set of information. Public concern over inequality has risen sharply over the past three decades, which has prompted greater demand for redistribution that will reduce inequality and create more opportunity. The report highlights that policy makers need to address the diverse perceptions and concerns as they design reforms, and considers several factors that impact public support for inequality-reducing policies, including:

• Information about inequality tends to be incorporated in line with people’s existing beliefs on what drives inequality, therefore concern over the issue and demand for inequality-reducing policies becomes a normative assessment built by both perceptions and preferences.
• People’s support for policies vary widely depending on the perceived effectiveness of the policy in reducing inequality.