The Impact of Workplace Income Rank on Attitudes toward Redistribution

• In Event: Grievance, Social Class, and Preferences for Redistribution

Abstract

Does relative income rank at the workplace shape attitudes toward redistribution? While the current consensus claims that perceptions of relative socioeconomic position rather than actual 'objective' income position explain redistributive preferences, our knowledge of the factors that shape these perceptions and their impact on support for redistribution is, at best, insufficient. In the article, we argue that individuals form perceptions of their socioeconomic status by comparing their income and earnings with colleagues, which, in turn, influences support for redistributive policies. Combining population-wide administrative records from Denmark with survey data, we establish two central results. First, we find that higher relative income placement in the workplace decreases support for redistribution. Second, we show that workplace rank is associated with perceptions of relative socioeconomic status, indicating that this serves as a channel through which relative income placement shapes attitudes toward redistribution. Conducting a wide range of sensitivity analyses, including coefficient stability analysis and using panel data with individual fixed effects, we confirm that our results reflect a causal effect of peer income. These findings provide insight into the everyday origins of redistribution attitudes and show when high- or low-income groups fail to recognize their subjective rank.

Author

• Matias Engdal Christensen, Aarhus University