Concern about inequality and actual inequality among OECD countries

This post examines the relationship between concern about inequality and actual inequality among OECD countries. Data on concern about inequality were taken from a recent international survey conducted by Pew Research. Data on actual inequality were taken from the OECD statistics database.

In their survey, Pew asked respondents in 14 OECD countries (as well as a number of non-OECD countries), "Do you think the gap between the rich and the poor is a very big problem, a moderately big problem, a small problem, or not a problem at all in our country?" To measure concern about inequality, I take the weighted average percentage of respondents who think inequality is a problem, assigning the weight '3' to answers of "a very big problem", the weight '2' to answers of "a moderately big problem", and the weight '1' to answers of "a small problem". Each value is for the year 2013.

I utilise two measures of actual inequality: the post-tax, post-transfer Gini index, and the ratio of disposable income at the 90th percentile to disposable income at the 10th percentile (the 90/10 ratio). Each value is for the latest available year (typically 2011 or 2012). The correlation between the two measures is very strong, namely r = .95 (p < 0.001).

The first chart shows the relationship between concern about inequality and the Gini index. The correlation is positive but very small and non-significant, namely r = .14 (p = 0.6). The second chart shows the relationship between concern about inequality and the 90/10 ratio. Again, the correlation is positive but very small and non-significant, namely r = .12 (p = 0.7). A major caveat, of course, is that rather few countries are included in the sample. On the other hand, the sample does encompass almost the full range of inequality among OECD countries, from Germany near one end of the spectrum to Chile and Mexico at the other.