Perceptions of wealth and income inequality: A distinction without a difference?

In this paper, we ask whether the public distinguishes between inequalities of income and inequalities of wealth. The distinction between the wealth and income distributions matters in the real economy: wealth is more unequally distributed than income, and unequal wealth may translate into political consequences in different ways than unequal income. However, it is unclear whether public opinion differentiates between income and wealth inequalities, for example by having distinct perceptions of high-income individuals compared to the wealthy. These public perceptions matter for the politics of redistribution, because the two types of inequality are best addressed with different policy tools, each of which needs to win popular approval. We combine empirical evidence from pre-existing data sources with an original pilot survey to characterize some popular perceptions of the wealthy and the rich. We then use the preliminary results to develop a research design for a larger follow-up study. The early results suggest that while people understand wealth and income as different phenomena, they by and large do not distinguish between the wealth and income distributions (both of which are seen as disconcertingly unequal). Additionally, the public does not distinguish between people who have high incomes and people who are wealthy. Even billionaires, whose wealth makes them objective outliers in the wealth distribution, are broadly viewed as belonging to the broader category of ‘the rich’. This studies contribution is two-fold. First, it deepens our understanding of how citizens think about income and wealth, which are unequally distributed to different degrees. Second, it contributes to methodological debates whether it is necessary to distinguish in survey questions between income and wealth inequality as two distinct economic terms.