A new study shows that pervasive income inequality discourages support for higher minimum wages, potentially deepening economic divides. The research underscores the psychological patterns influencing public opinion and offers insights for more effective advocacy.
High levels of income inequality are not just a socio-economic concern but also a significant psychological barrier to implementing policies aimed at reducing that very inequality, according to new research published in the Journal of Experimental Psychology: General.
The study — co-led by M. Asher Lawson, an assistant professor of decision sciences at INSEAD (European Institute of Business Administration) in Fontainebleau, France, and Daniela Goya-Tocchetto, an assistant professor of organization and human resources at the State University of New York at Buffalo — analyzed extensive data, including information from over 130,000 protests across the United States and eight additional experiments.
These initiatives revealed that an “is-to-ought” reasoning error — where people perceive the current state as the way things should be — fundamentally undermines support for higher minimum wages in regions of high economic inequality.
“When the rich earn dramatically more than the poor, people often infer that the rich should earn dramatically more than the poor,” Lawson said in a news release. “As a result, the presence of higher income inequality ends up legitimizing itself in the minds of the public. This, in turn, undermines support for policies such as higher minimum wages that could reduce inequality.”
While several local and state governments have increased minimum wage levels, the federal minimum wage remains unchanged at $7.25 per hour since 2009. That equates to an annual income of $15,080 for a full-time worker, which is below the federal poverty level for some government assistance programs.
The research demonstrated that higher local levels of income inequality were linked with fewer and less-attended protests on economic issues like minimum wage increases.
Through eight additional experiments, the researchers found that participants exposed to data showing higher economic disparity were more likely to support lower minimum wages and believed that low-income individuals deserved fewer resources.
“When inequality is high, the rich are perceived to need and deserve more, and the poor are perceived to need and deserve less,” the journal article noted. “The present research suggests that because of is-to-ought reasoning, having enough to meet one’s needs cannot be fully separated from inequality.”
The study also delved into the complex interplay between political beliefs and economic conditions.
“Conservatives consistently supported lower minimum wages regardless of the income distribution they viewed in the hypothetical societies, but liberals were more likely to support lower minimum wages when income inequality increased,” added Goya-Tocchetto. “While well-intentioned liberals seemed to more carefully consider the economic conditions of the societies they viewed, this also rendered them more sensitive to is-to-ought reasoning errors.”
This research offers a crucial insight for advocates aiming to raise the minimum wage.
As Lawson pointed out, emphasizing high levels of inequality may inadvertently normalize these disparities in the public’s mind.
“Our studies suggest that a more effective technique could be stressing how much lower inequality could be and making salient that higher minimum wages are a key pathway to achieve that goal,” Lawson added.
A final experiment with over 1,900 participants suggested potential for change. Participants who were allowed to adjust hypothetical economic distribution data suggested more equitable minimum wages, indicating that encouraging people to think about ideal conditions rather than current realities can reduce susceptibility to is-to-ought reasoning.
By offering a clearer understanding of the psychological barriers to economic reform, this study opens pathways to more effective advocacy and policy-making aimed at reducing income inequality.
Source: American Psychological Association