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Monday, 26 March 2018

Our perception of affluence is a bigger determinant of behavior than financial realities

The way we perceive our economic standing often often has a bigger effect on our behavior than the reality of the situation. Psychologists have found that people often derive their perception of their affluence through comparison with others — and are likely to change their behavior based on the subjective experience of feeling poor. This perception is usually not an actual reflection of reality; we are likely to see others as better-off than us, and therefore feel deprived, even if we are actually economically comfortable. “If affluence is in the eye of the beholder, then even the super-rich, when they compare their situation with that of the ultra-rich, can feel sorry for themselves,” Elizabeth Kolbert writes for the New Yorker. “In a society where economic gains are concentrated at the top … there are no real winners and a multitude of losers.”

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