Local versus national: the effect of correcting income misperceptions on inequality beliefs and preferences

Kattalina M. Berriochoa, Katy Morris and Andrew Mcneil

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: People often misjudge their place in the national income distribution, but national distributions are composites of heterogenous local contexts. Drawing on evidence that people tend to anchor to more immediate reference groups, we examine whether perceptions of local income position are more accurate and whether correcting local misperceptions has a stronger effect on inequality beliefs and policy preferences than correcting national misperceptions. Using a survey experiment in the United States, we find that perceptions of household position are equally inaccurate at both local and national levels, with respondents defaulting to the middle rung of the income ladder. Correcting these misperceptions shifts attitudes towards meritocracy and redistribution, with effects more consistently significant under local framing. However, local effects are not always statistically different from comparable national treatments, suggesting both corrections matter. Analyses of mechanisms indicate that corrections change perceptions of own financial wellbeing but do not change beliefs about societal inequality.

JEL-codes: J1 N0 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2026-08
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