How a Bad Economy Makes Us Feel Better Than Average

How a Bad Economy Makes Us Feel Better Than Average

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Here’s a surprising thought: as the rich get richer and the poor get poorer, each of us is more likely to rate ourselves as being farther above average. That’s the surprising message from a study of 1,625 people in 15 culturally diverse countries, which found that economic inequality is a strong predictor of what’s called “self-enhancement.”

In the study published in Psychological Science, university students were asked to rate themselves from 1 to 7 on various personality traits — how much of the trait they possessed compared with the average student, and how desirable the trait was. Four versions of the questionnaire listed different traits related to agreeableness, conscientiousness, extroversion, open-mindedness, and emotionality. The analytic design adjusted for differing cultural values. The researchers looked at the correlations between evidence of self-enhancement and the individualism or collectivism of a country, its “power distance” (the preference for an autocratic hierarchy versus relative equality of power), and its level of economic inequality.

Here’s what they found: Virtually everywhere, people rate themselves above average. But the more economically unequal the country is, the greater its participants’ self-enhancement. The study doesn’t say why this is so, but other research suggests that competition, especially in winner-take- all situations, makes standing out important, and this undermines modesty and encourages its opposite. That’s what happens in “highly polarized economies, where wealth at the top is gross and deprivation at the bottom is stark,” says University of Kent research associate Steve Loughnan. On the other hand, where resources are equally distributed, self-deprecation and blending in are more valued.

Loughnan says the study is important for “many domains of psychology.” Until recently, psychologists have focused on individual factors affecting well-being, such as education or family. But this research shows that “macro-social” factors also matter. “We live inside societies that have political and economic realities,” Loughnan asserts. “These affect how we think about the self and how happy we are.”

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