In this project we would like to examine whether someone’s relative position in income and education determines various outcomes outside the market: voluntary participation in society, trust in institutions, and opinions about inequality. Moreover, we seek to examine whether the influence of relative position varies across countries and across time periods, between the 1980s and the 2000s. With this agenda we set out to study the impact of changing inequalities on personal opinions and behaviour, which is crucial to understand the impact of macrolevel and microlevel developments on social cohesion in industrial and post-industrial societies.
In earlier work we demonstrated that relative earnings position, operationalized as the distance to median earnings, affected membership of trade unions. Trade unions, it appeared, particularly recruit among the middle groups in the earnings distribution. In the present project we wish to build upon this approach, by examining the impact of relative position in earnings and education on three core outcomes indicating participation in society: voluntary participation, social trust, and opinions on the fairness of inequality. Do people at the bottom of the earnings and education distributions participate less in society than people in the middle, and can potential decline in social trust and participation be explained by these distributional developments within and across countries? Are countries with a larger earnings dispersion characterized by less participation and social trust? How does relative earnings position affect personal opinions on the legitimacy of earnings inequality?
Country variations are important to study not only because countries differ in their distributions of earnings and education. More importantly, and more fundamentally, countries vary in terms of their institutional context, with a different labour market and educational institutional setup. Can country differences in the impact of relative position on participation and social trust be explained by the institutional structure of countries? Or, to put this question differently, is a particular institutional setup more successful for social inclusion of the wider population than another? For example, do wage-compressing institutions equalize participation beyond the labour market? Do educational systems that reduce early drop-out contribute to participation and trust among those at the bottom of the educational distribution? Does that impact participation and trust of those from less advantaged social and ethnic backgrounds, as these are over-represented among early school drop-outs?
Checchi, D., J.Visser, and H.van de Werfhorst (2007). Inequality and Union Membership: The Impact of Relative Earnings Position and Inequality Attitudes. forthoming in British Journal of Industrial Relations 2009