#2016-025 Fading hope and the rise in inequality in the United States
Jo Ritzen & Klaus F. Zimmermann
Fading hope and the rise in inequality in the United States
A substantial literature claims that the strong increase in inequality
over the last decade in Western industrial countries such as the United
States (US) would lead to increasing tensions between different
socio-economic groups which might in turn hamper economic growth. The
population's fading hopes regarding the outlook on the future seem to
confirm this. This paper qualifies this interpretation using survey data
collected by the Pew Research Center for the People covering 1999-2014.
Over the first decade, the decline in hope cannot be traced back to the
rising inequality. However, recent data from 2014 suggest that
inequality is now a major driver of a lower than ever level of hope.
Hence inequality is a recent factor, not the driver of the long-term
decline in hope.
JEL Classification: D31, J15
Keywords: Confidence, ethnicity, hope, human capital, income inequality