A provocative paper from the National Bureau of Economic Research this spring argues that, although most political arguments about the implications of income inequality "crucially assume that ordinary people know how high inequality is, how it has been changing, and where they fit in the income distribution," in fact "ordinary people have had little idea about such things. What they think they know is often wrong. Widespread ignorance and misperceptions of inequality emerge robustly, regardless of the data source, operationalization, and method of measurement."
Further, the authors (Vladimir Gimpelson and Daniel Treisman) argue that "the perceived level of inequality—and not the actual level—correlates strongly with demand for redistribution and reported conflict between rich and poor."
You can read the full paper here.
