Knowing one’s place? The role of income inequality in shaping positioning bias across 29 countries

This study investigates how individuals' misperceptions of their relative position in the income distribution-referred to as positioning bias-are shaped by income inequality. Drawing on the ISSP 2019 Social Inequality module, the analysis includes data from 31,368 individuals across 29 countries and employs multilevel modelling to test whether individuals are more likely to misperceive their position under conditions of high inequality. We explore heterogeneity across income groups and bias types (unbiased, underestimation, and overestimation). Findings reveal that inequality is associated with positioning bias, though the direction and magnitude depend on the individuals' actual income position. Individuals in disadvantaged positions are more accurate in their self-perceptions when inequality is high, while those in higher-income positions tend more towards underestimating their relative standing. Overall, the results show that higher inequality is associated with lower subjective status relative to respondents' actual position across all income groups. This research contributes to broader debates on inequality perceptions and redistributive preferences.