House Price Inequality and Political Efficacy
P5-02
Presented by: Matthias Haslberger
A chronic housing shortage and surging house prices have become a major political issue in the United Kingdom and other countries. This paper investigates how perceptions of and information about inequality in house prices affect individuals’ internal and external political efficacy, using new data from a large representative survey experiment that was administered in England and Wales.
Previous research has established that people generally underestimate the extent of inequality in their community, and that high inequality undermines political participation of disadvantaged groups. Therefore, we hypothesise that less affluent respondents exhibit lower political efficacy and that experimentally exposing respondents to information about inequality in house prices at the local or national level reduces their political efficacy, especially among non-homeowners.
We find that respondents who own (more valuable) houses report higher political efficacy, while those who are more concerned about inequality exhibit lower efficacy. However, informing respondents about the extent of inequality in house prices does not reduce external efficacy, and the effect on internal efficacy is positive. Moreover, we show striking heterogeneous effects. Non-owners have significantly lower internal efficacy than homeowners, but the gap vanishes when they are shown local house prices compared to the national distribution. This effect is particular to housing; it does not translate to other measures of affluence.
These findings suggest that arguments which link perceptions of inequality and reduced political participation, may not apply to the housing market. Thus, our paper highlights the salience of the housing market for political behaviour and outcomes.
Previous research has established that people generally underestimate the extent of inequality in their community, and that high inequality undermines political participation of disadvantaged groups. Therefore, we hypothesise that less affluent respondents exhibit lower political efficacy and that experimentally exposing respondents to information about inequality in house prices at the local or national level reduces their political efficacy, especially among non-homeowners.
We find that respondents who own (more valuable) houses report higher political efficacy, while those who are more concerned about inequality exhibit lower efficacy. However, informing respondents about the extent of inequality in house prices does not reduce external efficacy, and the effect on internal efficacy is positive. Moreover, we show striking heterogeneous effects. Non-owners have significantly lower internal efficacy than homeowners, but the gap vanishes when they are shown local house prices compared to the national distribution. This effect is particular to housing; it does not translate to other measures of affluence.
These findings suggest that arguments which link perceptions of inequality and reduced political participation, may not apply to the housing market. Thus, our paper highlights the salience of the housing market for political behaviour and outcomes.