The Individual Perception of Wage Inequality: A Measurement Framework and Some Empirical Evidence

48 Pages Posted: 26 Dec 2015

See all articles by Andreas Kuhn

Andreas Kuhn

University of Zurich; IZA Institute of Labor Economics


This paper presents a simple conceptual framework specifically tailored to measure individual perceptions of wage inequality. Using internationally comparable survey data, the empirical part of the paper documents that there is huge variation in inequality perceptions both across and within countries as well as survey-years. Focusing on the association between aggregate-level inequality measures and individuals' subjective perception of wage inequality, it turns out that there is both a high correlation between the two measures as well as a considerable amount of misperception of the prevailing level of inequality. The final part of the analysis shows that subjective inequality perceptions appear to be more important, in a statistical sense, in explaining variation in individual-level attitudes towards social inequality than objective measures of inequality. This underlines the conceptual and practical importance of distinguishing between subjective perceptions of inequality and the true level of inequality.

Keywords: inequality perceptions, inequality, attitudes towards social inequality, (mis-)perceptions of socio-economic phenomena

JEL Classification: D31, D63, J31

Suggested Citation

Kuhn, Andreas, The Individual Perception of Wage Inequality: A Measurement Framework and Some Empirical Evidence. IZA Discussion Paper No. 9579, Available at SSRN:

Andreas Kuhn (Contact Author)

University of Zurich ( email )

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Zurich, 8006

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072

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