# (Mis)perceptions of individual position in national and global income distribution. The Italian case

## TL;DR

This study explores how Italians misperceive their income rank nationally and globally, revealing patterns influenced by factors like age, education, and region.

## Contribution

The paper is one of the first to analyze both national and global income rank perceptions, highlighting consistent central tendency bias across contexts.

## Key findings

- Individuals tend to place themselves near the median of income distribution regardless of their actual rank.
- Lower-income individuals overestimate their rank, while higher-income individuals underestimate it.
- Misperceptions vary by age, employment status, education, migration background, and regional economic conditions.

## Abstract

This study investigates income rank (mis)perceptions in Italy, focusing on the discrepancy between individuals' subjective assessments of their income position and their objectively measured positions in national and global income distribution. The research utilizes data from a large-scale national survey Inequality between reality and perception (IneqPer, n = 12,000; 2024/2025). It provides consistent evidence of the pervasive central tendency bias, when individuals place themselves near to the median of income distribution regardless of their objective income rank. The findings also reveal systematic patterns of misperceptions. Lower-resource individuals tend to overestimate their income rank, while higher-resource individuals often underestimate it. Misperceptions vary significantly by gender, age, employment status, education, migration background, the type of settlement, and regional economic conditions: young, unemployed, and immigrants are more prone to overestimate their rank in income distribution, while men, older, employed, those from urban areas and more educated individuals are more likely to underestimate it. Political orientation shows no associations with misperceptions of national income rank, but left-oriented respondents are more accurate with respect to global ranks, whereas all other respondents underestimate their global rank. Regionally, residents of less affluent Southern areas tend to overestimate their income rank, whereas those in wealthier Northern regions often underestimate it. The study is one of the first that analyses both national and global income rank perceptions. The results show that central tendency bias emerges consistently across different contexts, suggesting that income distributions are broadly perceived as abstract. These insights have implications for public policy, economic behavior, and interventions addressing inequality in Italy and in the world.