Economic inequality is associated with preferences for smaller, immediate gains over larger, delayed ones. Such temporal discounting may feed into rising global inequality, yet it is unclear whether it is a function of choice preferences or norms, or rather the absence of sufficient resources for immediate needs. It is also not clear whether these reflect true differences in choice patterns between income groups. We tested temporal discounting and five intertemporal choice anomalies using local currencies and value standards in 61 countries (N = 13,629). Across a diverse sample, we found consistent, robust rates of choice anomalies. Lower-income groups were not significantly different, but economic inequality and broader financial circumstances were clearly correlated with population choice patterns.
A number of South American countries experienced turbulent democratic, political and economic upheaval over the last 40 years in the form of coup d'états in the 1970s, tumultuous elections, and repeated severe economic crises, some of which happened fairly recently. Starting in 2010, a number of court proceedings across the region have made past military coup d'états the focus of national conversations. South American citizens may, therefore, have lost confidence in national institutions that have repeatedly disappointed their trust and expectations; a situation with potentially detrimental effects on their well-being. Using eight waves of the Gallup World Poll collected between 2009 and 2016 across ten South American countries, we investigate to what extent people's confidence in financial institutions, the honesty of elections, the military, the judicial system, the national government and the police is associated with people's current and expectation of future life satisfaction. We find that people who report confidence in these six institutions rate their current and expected life satisfaction, on average, to be higher than those who lack these types of institutional confidence, even after controlling for demographic factors and macroeconomic indicators. In addition, we investigate changes over time for all six measures of confidence in institutions as well as for current and expectation of future life satisfaction. Our results suggest that governments' investments in well-functioning institutions may contribute positively to subjective well-being in a society. However, our analysis is correlational and we thus cannot rule out reverse causality.
Does income rank matter more for well-being in more unequal countries? Using more than 160,000 observations from 24 countries worldwide, we replicate previous studies and show that the ranked position of an individual’s income strongly predicts life evaluation and positive daily emotional experiences, whereas absolute and reference income generally have weak or no effects. Furthermore, we find the association between income rank and an individual’s well-being to be significantly larger in countries where income inequality, represented by the share of taxable income held by the top 1% of income earners, is high. These results are robust to using an alternative measure of income inequality and different reference group specifications. Our findings suggest that people in more unequal societies place greater weight on the pursuit of higher income ranks, which may contribute to enduring income inequality in places where greater well-being can be bought from moving up the income ladder.
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