Bryan Caplan

What, Me Rich?

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A very interesting paper by Moses Shayo begins by surveying the literature on identity. "People tend to identify more with high status groups than with low status groups," which seems pretty obvious.

But I'm not so sure. A major counter-example: Almost no one in the United States identifies himself or herself as "upper class" or "rich." I know lots of rich lawyers, but they imagine themselves "middle class" just like everyone else. Here is a little data from the 1998 General Social Survey. Given the question:

If you were asked to use one of four names for your social class, which would you say you belong in: the lower class, the working class, the middle class, or the upper class?

Responses were:

Lower Class 5.4%
Working Class 45.1%
Middle Class 45.9%
Upper Class 3.6%

More surprisingly, if you add an "upper middle class" option, it remains a far less popular response than "middle class."

If the social psychologists have it right, why are people so reluctant to proclaim themselves "upper class"? Surely the top 20% of Americans could convince themselves that they are the creme de la creme. But in practice, people would rather identify with the lower class than the upper!

Part of my explanation is that rich people compare themselves to other rich people. Junior lawyers compare themselves to partners, and partners compare themselves to their clients. "Now he's rich; I'm just a working stiff."

But the deeper explanation, I suspect, is that "the rich" are a popular scapegoat for what's wrong with the world. So you can raise your self-esteem by subjectively exiting from your objective income bracket.

I can imagine that distaste for "the rich" discourages work effort. If you succeed too well, you become one of them. But there is a psychological safety valve. If you earn more money than other people do, you identify with your occupation (e.g. doctor) or job title (e.g. executive vice president). That way you can count your millions without counting yourself a malefactor of great wealth.


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Conchis writes:

As a counterexample to your counterexample: remember the Time survey that supposedly found that 20% of those surveyed believed they were in the top 1% of earners?

I can see a few potential explanations for the divergence in responses:

(i) responses to the "class" question are less a reaction against the rich, as a reaction against the connotation of unearned riches implied by the (very English-sounding) concept of being "upper class";

(ii) people are happy to privately identify as rich, while being publicly uncomfortable with doing so.

I would expect either of these to take some (though by no means all) of the force from the argument that people are less willing to work hard in pursuit of riches.

Conchis writes:

P.S. The other (pedantic) point, which I forgot to make, is that you counterexample isn't really a counterexample to the theory - if only because the theory is almost tautologically true: what is a "high status group" other than a group which people have positive feelings towards and want to identify with?

I think you're arguing about what counts as "high status", rather than whether the theory is true.

Lawrance George Lux writes:

My worthless Income ascribes me as Working Class or simply Poor, but does not deny that I am Patrician. Moving on One might say that rich people who were born and raised Poor, do not suffer from the 'self denial' response. lgl

Jan writes:

I can see how working class might correlate to people with blue collar jobs, middle class might correlate to people with jobs that require college degrees, and maybe people on welfare might be lower
class. I don't see any clear way to define upper class. It does see to imply some English upper class definition that sounds very snobbish. Most wealthy people in the US probably started out middle class and probably feel they still are middle class. I don't think there is a commonly held definition of upper class in the US.

Hee Hate Me writes:

Isn't that about correct? How is the question posed? I would think that most people think that upper-class means that one does not have to work for a living. In that case 3.6% seems about right maybe even on the high side.

Jim Glass writes:

Surveys I've seen say Americans think they are middle class if they work for a living and have to work to maintain their standard of living.

That covers a tremendous range from just getting out of poverty to making $500k a year but having to do so to pay for the mortgage and the private schools and the alimony for the first two wives and so on or you lose all you've got.

Americans think you're "upper class" if you have inherited money, don't have to work, and can galivant around with the Hilton girls; and "lower class" if you don't work and are on welfare.

And Americans are right in this. Two people who work for a living and who both have to do so to maintain their stations in life have more in common with each other -- even if their incomes are six-figures apart -- than either has with anybody who goes through life not knowing what work is.

Jim Glass writes:

I'll add a note on the "upper class" bit -- as other have noted, I don't think most Americans think there is an "upper class" here, not in the sense that the term is used in say Britain. Rather, there's a "rich" class who don't work, and a middle class that does.

No doubt there are some Thurston Howell IIIs among the rich who consider themselves "upper class" (and a good number of tenured university professors who don't really have to work and consider themselves the intellectual elite) but they are not most Americans.

hc writes:

I believe in the era of mass production belonging to elite doesn't pay off anymore. There are practically no status symbols or goods left out of range of middle class. The only difference between the middle class and the richest is that the middle classers have to priorize their consumption.

On the other hand, being upper class creates unwanted visibility, jealosy etc. The best way to live as a rich person is to cling to the (upper) middle class and maybe be silent of the fact that you didn't have to choose between the new car and a trip around the world.

spencer writes:

I go along with those looking at the problem of using income to measure wealth. The real measure of wealth is assets. If you have enough assets that you do not have to work you are wealthy. If
you have to work to maintain the desired life style you may be "rich" but you are not wealthy.

Tony Vila writes:

The paper stated that people are more likely to call themselves rich than poor. Just because more people do call themselves poor than rich, does not make that untrue. If you have many more poor than rich, even with the relative willingness to label yourself in a group, then you'll get more people calling themselves poor.

Looking at these survey figures, I find it doubtful that the ratio of rich:poor is as high as 3:5, confirming the findings of the study.

Americans seem to desire to call themselves "middle" in many ways, not just socioeconomically, but also in terms of intelligence and culture. That seems the most positive place to be. I don't know why.

AJE writes:

It'd be interesting to apply this multi-nationally.

"In America, and Britain, class is something to overcome. In Russia, and Australia, it is something to be celebrated."

Joshua Allen writes:

You say that people tend to compare themselves with richer peers; but that just proves that people identify more with the richer peers. It's like the monkey in the monkey cage who identifies with the human trainer; "get all these stinking monkeys away from me!"

So I think people certainly *identify* with people they want to be like. On the other hand, most people can accurately asses their social status. In public, people underreport their status (except single guys trying to pick up women at bars), and it has been difficult during bubble and bust to know exactly where one stood relative, but I think people are mostly very aware of their relative position to others.

Rick Gaber writes:

Shayo:

"People often conceive themselves as members of social groups."

This may be true for collectivists in general (including such philosophically-confused entrepreneurs as Ted Turner, Mark Cuban and Maria Cantwell), but I would postulate NOT for individualists in general. Without a careful distinction between them, I'm afraid the entire proposition is flawed.


Mcwop writes:

The book "The Millionaire Next Door"
The Surprising Secrets of America's Wealthy
By Thomas J. Stanley, Ph. D. and William D. Danko, Ph. D. documented who the rich are.

Take a look at the portrait of the rich, and it bocomes clear why many consider themselves middle class.

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