TY - JOUR
T1 - A growing socioeconomic divide
T2 - Effects of the Great Recession on perceived economic distress in the United States
AU - Glei, Dana A.
AU - Goldman, Noreen
AU - Weinstein, Maxine
N1 - Funding Information:
This work was supported by the National Institute on Aging [https://www.nia.nih.gov/, grant numbers P01 AG020166 & U19AG051426 to Carol D. Ryff]; the Eunice Kennedy Shriver National Institute of Child Health and Human Development [https://www.nichd.nih.gov/, grant number P2CHD047879], and the Graduate School of Arts and Sciences, Georgetown University [https://grad. Georgetown.edu/]. Noreen Goldman would like to thank the Russell Sage Foundation for their support while she was a Visiting Scholar in 2018-2019. The funders had no role in study design, data collection and analysis, decision to publish, or preparation of the manuscript. This work was supported by the National Institute on Aging [https://www.nia.nih.gov/, grant numbers P01 AG020166 & U19AG051426 to Carol D. Ryff]; the Eunice Kennedy Shriver National Institute of Child Health and Human Development [https://www.nichd.nih.gov/, grant number P2CHD047879], and the Graduate School of Arts and Sciences, Georgetown University [https://grad.Georgetown.edu/]. Noreen Goldman would like to thank the Russell Sage Foundation for their support while she was a Visiting Scholar in 2018–2019. The funders had no role in study design, data collection and analysis, decision to publish, or preparation of the manuscript. We are grateful to Germán Rodríguez for his advice regarding the modeling strategy. Furthermore, we thank Andrew Cherlin, Samuel H. Preston, Lauren Gaydosh, and Peter Muennig for their comments on the manuscript.
Publisher Copyright:
© 2019 Glei et al. This is an open access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.
PY - 2019/4
Y1 - 2019/4
N2 - We demonstrate widening socioeconomic disparities in perceived economic distress among Americans, characterized by increasing distress at the bottom and improved perceptions at the top of the socioeconomic ladder. We then assess the extent to which hardships related to the Great Recession account for the growing social disparity in economic distress. Based on the concept of loss aversion, we also test whether the psychological pain associated with a financial loss is greater than the perceived benefit of an equivalent gain. Analyses are based on longitudinal survey data from the Midlife Development in the US study. Results suggest that widening social disparities in perceived economic distress between the mid-2000s and mid-2010s are explained in part by differential exposure to hardships related to the Great Recession, the effects of which have lingered even four to five years after the recession officially ended. Yet, auxiliary analyses show that the socioeconomic disparities in economic distress widened by nearly as much (if not more) during the period from 1995–96 to 2004–05 as they did during the period in which the recession occurred, which suggests that the factors driving these trends may have already been in motion prior to the recession. Consistent with the loss aversion hypothesis, perceptions of financial strain appear to be somewhat more strongly affected by losses in income/assets than by gains, but the magnitude of the differentials are small and the results are not robust. Our findings paint a dismal portrait of a growing socioeconomic divide in economic distress throughout the period from the mid-1990s to the mid-2010s, although we cannot say whether these trends afflict all regions of the US equally. Spatial analysis of aggregate-level mortality and objective economic indicators could provide indirect evidence, but ultimately economic “despair” must be measured subjectively by asking people how they perceive their financial situations.
AB - We demonstrate widening socioeconomic disparities in perceived economic distress among Americans, characterized by increasing distress at the bottom and improved perceptions at the top of the socioeconomic ladder. We then assess the extent to which hardships related to the Great Recession account for the growing social disparity in economic distress. Based on the concept of loss aversion, we also test whether the psychological pain associated with a financial loss is greater than the perceived benefit of an equivalent gain. Analyses are based on longitudinal survey data from the Midlife Development in the US study. Results suggest that widening social disparities in perceived economic distress between the mid-2000s and mid-2010s are explained in part by differential exposure to hardships related to the Great Recession, the effects of which have lingered even four to five years after the recession officially ended. Yet, auxiliary analyses show that the socioeconomic disparities in economic distress widened by nearly as much (if not more) during the period from 1995–96 to 2004–05 as they did during the period in which the recession occurred, which suggests that the factors driving these trends may have already been in motion prior to the recession. Consistent with the loss aversion hypothesis, perceptions of financial strain appear to be somewhat more strongly affected by losses in income/assets than by gains, but the magnitude of the differentials are small and the results are not robust. Our findings paint a dismal portrait of a growing socioeconomic divide in economic distress throughout the period from the mid-1990s to the mid-2010s, although we cannot say whether these trends afflict all regions of the US equally. Spatial analysis of aggregate-level mortality and objective economic indicators could provide indirect evidence, but ultimately economic “despair” must be measured subjectively by asking people how they perceive their financial situations.
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U2 - 10.1371/journal.pone.0214947
DO - 10.1371/journal.pone.0214947
M3 - Article
C2 - 30947252
AN - SCOPUS:85063996168
SN - 1932-6203
VL - 14
JO - PloS one
JF - PloS one
IS - 4
M1 - e0214947
ER -