The International Organization for Economic Cooperation and Development (OECD) studied perceptions of income inequality in its 32 member countries. The vast majority of communities – an average of 80%. Of the respondents – the inequality is noted and believes that it is very large. As inequality has increased over the past three decades, this belief has grown stronger.
A report titled “Does Inequality Matter?” (“Do the disparities matter?”). What is “generational mobility”? That children from poor families have less and less chance of improving their social status. So, about inequality of opportunity.
But let’s start with the data that tells us what people from Chile and the United States to New Zealand and Japan think about inequality. Portugal is seen as the most obvious case of inequality. This is a country where 96 percent. of citizens think that the income gap is too high. Central and Eastern European countries are at the forefront of countries where societies feel the greatest inequality, which may be a sign of the darker aspects of the transition.
Lithuania (94%) comes just behind Portugal, followed by Hungary (93%), Estonia (90%), Latvia (90%) and Slovakia (89%). On the other hand, Danes are the least sensitive to inequality. There is only 54 percent. People say they live in a country where the income gap is too big. Behind Denmark is the Netherlands (59 per cent) and – which may come as a surprise – the USA, where 63 per cent of the income gap is very high. citizens.
Why might this be surprising? Because in the USA, the inequality measured by the Gini coefficient (which is reported annually by the Organization for Economic Co-operation and Development of all countries belonging to the organization) is among the largest among advanced economies. So it turns out that the concept of inequality does not have to be the same in different societies, although objective data show something different. But what is the actual data?
There is also a problem with that. Because the Gini coefficient is calculated in OECD countries on the basis of surveys conducted among households, the richest people are not quite ready to rely on interviews for their income. This aroused skepticism among many economists who in many countries (including Great Britain and Poland) calculated the Gini coefficient on the basis of tax returns. And it turns out to be much higher, so the disparities are much greater than what the polls show.
How do Poles view inequality? As much as 83 percent. Mina says it’s too big in our country. Let’s add – the data for Poland is from a 2017 Eurobarometer survey, from the time of the PiS Act, when people were already getting 500+. Belief about inequality in Poland is lower than in many other post-communist countries, but is higher than the average in advanced economies, for example, in the Czech Republic (78%).
Moreover, the OECD has been doing research since 1987 and it turns out that concerns about the income gap have increased dramatically since then. Whereas in 1989-1993 the ratios between proponents of the view “larger differences in income motivate individual effort”, and beliefs “income ought to be more equal” were somewhat, halved, in the years following the great global crisis the financial advantage of people who express the view that income should be increased equally. It declined slightly again in 2017-2020.
After the Great Financial Crisis of 2007-2009, the perception that incomes should be more equal prevailed in Chile, Slovenia and Austria (more than 70% of the responses), followed by Germany, Finland and Estonia. Estonia is an example of a country in which the views of society have changed over a quarter of a century. Whereas at the beginning of the transition, a larger income inequality of about 70% was supported. People, in studies from 2008-14 it fell to less than 40 percent.
A similar development occurred in Poland. At the beginning of the transformation, the opinion about the need for greater differentiation of income certainly prevailed, since it was a stimulus to individual efforts. The survey of world value and the study of European values in Poland (after Malta and Estonia) recorded the greatest support for such an opinion, at the level of about 70%. In 2008 and 2014, this support fell by 20 percentage points and there was little advantage in our society for the view that income should be more equal.
If we judge inequality as bad, what should we do about it? This is not very well known to the public, according to OECD research.
“(…) although most people are concerned about inequality, they have very different beliefs about its scope and what to do with it,” the report said.
Why don’t they know? Because people do not have a good idea of the actual distribution of income in their country. Opinions on this topic differ greatly from each other. On average, in OECD countries, a quarter of people think more than 70 percent. Income goes to 10 percent. The richest families, a quarter of them believe that 10 per cent. The richest objects less than 30 percent. Revenues. In Chile and the USA, that is, in the two OECD countries belonging to the group with the most inequality, opinions about the income share are 10%. The richest are the most separated.
The common belief is that the state has to do “something” about inequality. More than 7 in 10 OECD citizens believe their government should do more to reduce the income gap between the rich and the poor. How do? Through taxes and transfers.
“The more people fear inequality and perceive low social mobility, the more they express a need for redistribution,” the report said.
72% are convinced that it is the government’s duty to reduce the income gap in OECD countries. Participants in the European Union – 79 percent, in Poland – 81 percent. Most people agree with this approach in Portugal (95%), Latvia, Cyprus, Slovenia and Italy, and least in the United States (33%), followed by Australia, New Zealand and Japan. These results show that people are more interested in income classification than they are in “ordering” redistribution.
The “demand for redistribution” is the difference between the percentage of people concerned about inequality and those who believe that the issue of inequality should be addressed by the government. Surprisingly, the “redistributive demand” is greatest in countries as diverse in terms of income and distribution as Finland, Greece, Malta, the Netherlands and Cyprus. The lowest demand is in the USA, where the difference is minus 30 percentage points. On average, in the OECD countries it is minus 8 p., in the European Union – minus 5 p., and in Poland it is minus 2 p.
OECD research shows that concerns about income disparities vary widely across social and economic groups. The results were quite intuitive—the elderly, women, the rural and the less fortunate are more concerned about income inequality.
But the research also showed conclusions that are far from superficial intuition. The report concludes that over the past three decades, people’s views of inequality have increased in terms of difference, even among people with similar socioeconomic characteristics. This means more polarization in societies.
And the gap between those who think inequality is high and those who think it is low is widening in most OECD countries. Moreover, the greater the disparities in a country, the greater their number Public opinion is more divided. This situation can pose a major challenge to the policy of reducing inequality and sustainable development.
“Recovering from the COVID-19 crisis requires policies and reforms that eliminate inequality and promote equal opportunity. However, implementing such reforms requires broad public support… Divided public opinion can complicate implementation of reform,” the report said.
OECD studies indicate that what matters for the effectiveness of a policy in reducing inequality is, first and foremost, persuading societies that it is effective. Second, it will be important for people to understand the causes of inequality.
Initially, the report concluded that people were unlikely to expect greater redistribution if they believed benefits were misdirected, not reaching those in need. They are less likely to favor progressive taxation if they believe that corruption is widespread among officials and that tax money will be misused and the allocation of public benefit will be distorted.
Second, the ‘demand’ for more progressive taxes is also less when people believe that poverty is caused by a dearth of personal effort (for example, laziness and idleness) rather than by circumstances beyond the control of the poor.
And so, for example, in 2018 in Poland 25%. The people answered that poverty results from the efforts of the poor themselves and not, for example, from injustice or misfortune. This is the highest percentage of people expressing this view of any OECD country. At the time, 54 percent expressed support for progressive taxes. Threads. It is – next to Denmark and Estonia – the lowest of all countries. In the same study conducted in Germany, only 4% of people were willing to blame the poor for their poverty. On the other hand, 77 percent of the vote expressed support for more progressive taxes. Germans.
Jacek Ramotovsky
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