Most Americans Wish U.S. was Like Sweden

AllGov - News - Most Americans Wish U.S. was Like Sweden.

Most Americans Wish U.S. was Like Sweden           Friday, September 24, 2010

Americans really want to live like they’re in Sweden, even if they don’t realize it.

Researchers from Harvard and Duke Universities surveyed a group of Americans on the subject of income inequality and found people’s preferred model of wealth distribution was that of the Swedes — after being given the choice of sticking with what the United States has to offer these days.

When shown the wealth distribution of the U.S. and Sweden’s (without labels), 92% of respondents chose the Swedish one.

The research also revealed that Americans “vastly underestimated the actual level of wealth inequality in the United States,” believing that the wealthiest 20% of the population currently controls about 59% of the wealth, when the actual number is closer to 84%.

When asked how much of the country’s wealth the richest 20% should hold, respondents said no more than 32%.      -- Noel Brinkerhoff

Building a Better America – One Wealth Quintile at a Time (by Michael I. Norton, Harvard Business School, and Dan Ariely, Duke University) (pdf)

Don't miss the three graphics in this short -- 13 page -- PDF. [2 are available here]

Here's the abstract:

Disagreements about the optimal level of wealth inequality underlie policy debates ranging from taxation to welfare. We attempt to insert the desires of “regular” Americans into these debates, by asking a nationally representative online panel to estimate the current distribution of wealth in the United States and to “build a better America” by constructing distributions with their ideal level of inequality.

• First, respondents dramatically underestimated the current level of wealth inequality.
• Second, respondents constructed ideal wealth distributions that were far more equitable than even their erroneously low estimates of the actual distribution.

Most important from a policy perspective, we observed a surprising level of consensus: All demographic groups – even those not usually associated with wealth redistribution such as Republicans and the wealthy – desired a more equal distribution of wealth than the status quo.

Addendum:  I'm borrowing shamelessly from James Fallows' post.  Notice that the first bar shows the actual distribution of wealth; the following ones show the respondents' estimates and description of their ideal distributions.

"The chart below conveys the central point: people think the distribution of wealth is more equal than it actually is; and they think it should be much more equal than their already unrealistically-equal notion of its current state. Eg: the top 20% of the US wealth distribution actually controls nearly 85% of total wealth; people think the top 20% controls under 60%; and they think it should control just over 30%



Similarly: people feel that the bottom 20% of the economic pyramid "should" have about 10% of the total pie; they think it actually has about 3% or 4%; in fact, its share appears to be too small to show up on the chart.

After the jump, another chart showing how these misperceptions break down among income groups. The de-middle-classing of America is a familiar story, but since it will be seen as one of the huge trends of this stage of history it deserves even more attention than it gets.

_____
Another chart, showing estimates of what that wealth distribution is, and what it should be, among people in three income groups (under $50,000, $50,000 to $100,000, and above $100,000.) Main variation: the more money people make, the larger the share they think should go to the top 20%.