Three types of income inequality: a comparison of left behind places and more developed regions in the EU

Abstract

Despite the growing interest in subjective inequality, little is known about the relation between this and more objective measures of inequality, especially in the light of regional disparities. This study focuses on the patterns of actual income inequality and two subjective measures in NUTS 2 EU regions. By accounting for multiple indicators of economic (under)performance, we show that actual inequality is positively related to people’s perceptions in left behind places, but not in more developed regions. Furthermore, both residents of less developed or—‘left behind’—regions and those of more developed regions exhibit a preference for lower levels of income inequality.