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Equity theory explains how our sense of fairness influences the dynamics of close relationships. Rooted in social psychology, the theory posits that individuals evaluate fairness by comparing the ratio of their contributions to the rewards they receive. Relationship satisfaction is highest when these ratios are perceived as balanced between partners, promoting mutual reciprocity and a sense of justice.Equity vs. Equality in RelationshipsEquity is distinct from equality. Fairness does not...
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First impressions play a crucial role in social perception, shaping how individuals assess others in professional, academic, and interpersonal contexts. Psychological research highlights the significance of cognitive biases, such as the primacy and recency effects, which influence how people interpret and recall information.The Primacy Effect and Cognitive AnchoringThe primacy effect describes the tendency for initial information to impact judgment disproportionately. When individuals encounter...
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The Collective Trust Game: An Online Group Adaptation of the Trust Game Based on the HoneyComb Paradigm
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Inequality, perception biases and trust.

Markus Knell1, Helmut Stix1

  • 1OeNB, Economic Studies Division, Otto-Wagner-Platz 3, POB-61, A-1011 Vienna, Austria.

Journal of Economic Inequality
|May 24, 2021
PubMed
Summary

Income inequality negatively impacts interpersonal trust. Perceived inequality, not just objective measures, is key to understanding this effect on social cohesion.

Area of Science:

  • Socioeconomics
  • Social Psychology

Background:

  • Existing research often uses objective inequality measures like the Gini coefficient.
  • These objective measures may not fully capture the nuanced relationship with interpersonal trust.

Purpose of the Study:

  • To develop a theoretical framework linking income inequality, trustworthiness, and interpersonal trust.
  • To investigate the role of individual perceptions of inequality in this relationship.

Main Methods:

  • Proposed a theoretical model where agents assess inequality based on reference groups, leading to biased perceptions.
  • Emphasized the distinction between objective and perceived inequality measures in empirical analysis.

Main Results:

  • Demonstrated that perceived inequality has a stronger negative effect on trust than objective measures.
Keywords:
InequalityPerceptionTrust

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  • Showed that objective measures alone can underestimate the true impact of inequality on trust.

    • Conclusions:

    • Individual-specific perceptions of inequality are crucial for accurately estimating its effect on trust.
    • Survey data supports the framework, indicating that higher perceived inequality significantly reduces interpersonal trust.