Social status and the relationship between income rank and well-being in 109 nations

TL;DR

This study shows that income rank, not income itself, is more strongly linked to well-being in most countries, especially where social capital is low.

Contribution

The study introduces a general model testing income rank and relative deprivation effects on well-being across 109 nations.

Findings

In 80% of countries, income rank is more strongly associated with well-being than absolute income or relative deprivation.

Income rank effects are three times stronger in materialistic countries and 80% weaker in those with high social capital.

Results are consistent across multiple survey years, supporting the role of social status in well-being.

Abstract

Well-being is linked to income. However, lower well-being among lower-income individuals may reflect either economic relative deprivation or the lower social status associated with a lower income rank. Here, using Gallup World Poll data from 109 countries and over 90,000 individuals, we test a general model that includes both relative income deprivation and income rank as special cases. In 80% of countries, subjective well-being is more strongly associated with within-nation rank of income than with absolute income or relative income deprivation. Income rank coefficients are over three times larger in the most materialistic countries, but smaller in countries with higher social capital: In countries with the highest civic engagement, the association between income rank and well-being is about 80% smaller. Results replicated in multiple survey years and are consistent with a link between income-related social status and subjective well-being that is stronger when social capital is low.

Higher incomes are associated with higher well-being. Here, in a 109-nation study, the authors show that the rank of income, rather than income itself, is associated with higher well-being, especially in nations with lower social capital.

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