Is unequal responsiveness caused by high-income earners having more informed opinions?: An empirical test.

Abstract

Previous research has shown that the affluent see more of their preferred policies realized, which scholars of opinion—policy responsiveness attribute to unequal influence. A rival theory instead states that the reason is informational asymmetry: High-income earners have more informed opinions, which align better with policymakers’ decisions. We test this rival theory in a most-likely case, where other sources of unequal opinion—policy responsiveness are minimized: monetary policy, set by an independent central bank. Analyses of survey data from more than 100,000 UK respondents initially reveal several findings in line with the theory: The official interest rate develops in ways relatively more favored by high-income earners, and high-income earners also exhibit better understanding of central bank policy and the economy. Nevertheless, informational asymmetries only explain part of why high-income earners get more of the policy they prefer, even in this most-likely setting. Case-specific reasons for unequal congruence are then explored.