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Understanding the Impact of Perceived Fairness on Subjective Well-Being across Varying Levels of Inequality

Mon, August 11, 4:00 to 5:30pm, East Tower, Hyatt Regency Chicago, Floor: Ballroom Level/Gold, Grand Ballroom B

Abstract

Drawing on a theoretical framework that emphasizes the central role of perceived fairness in shaping individuals' subjective well-being (SWB), this study explores the influence of perceived income fairness on life satisfaction across varying levels of income inequality. Analyzing data from Round 9 of the European Social Survey (ESS), the study compares the analytical model in the Czech Republic, Poland, and Serbia—countries representing different levels of income inequality. The results reveal significant cross-country variations in perceived income fairness, life satisfaction, and the relationship between these variables. Both life satisfaction and perceived income fairness are highest in Czechia, followed by Poland, and lowest in Serbia. Supporting our hypothesis, the negative impact of perceived unfairness on life satisfaction is particularly pronounced in Serbia and Poland, countries with higher levels of income inequality, compared to Czechia, which has the lowest level of income inequality. This relationship holds even after controlling for household income, education, gender, age, marital status, and health status, underscoring the critical importance of income fairness in societies characterized by higher levels of income inequality. The study's findings enhance our understanding of the complex interplay between perceived fairness, income inequality, and subjective well-being. The implications of this study are significant for policymakers, highlighting the necessity for targeted interventions that promote greater fairness in societies marked by high-income inequality. Future research could explore the differential effects of various dimensions of fairness and address the identified limitations to further advance our understanding of these dynamics.
Keywords: perceived fairness, income inequality, life satisfaction, subjective well-being, post-communist Eastern European countries.

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