The Bad Side of a Good Economy: How Perceptions of the Economy Moderate the Relationship between Financial Strain and...

How do perceptions of the economy moderate the association between financial strain and powerlessness? This article tests four novel hypotheses using two nationally representative samples of American (N = 2,466) and Canadian (N = 2,501) workers collected in late 2023. The amplified threat and protective economic optimism hypotheses suggest that for those who are financially struggling, perceiving the economy as "poor" is associated with more powerlessness and perceiving it as "good" is associated with less powerlessness, respectively, relative to those who perceive the economy as "fair"; the comparison-protection and meritocratic attribution hypotheses propose the opposite. We find support for the meritocratic attribution hypothesis in both countries. Those who are financially struggling report higher levels of powerlessness if they perceive a good economy than if they perceive a poor or fair economy. In other words, the positive association between personal financial strain and powerlessness is stronger among those who perceive a good economy. By contrast, we do not find evidence that perceiving a poor economy weakens financial strain's association with powerlessness relative to those who perceive a fair economy.