Background: Reducing income inequality is one possible approach to boost subjective well-being (SWB). Nevertheless, previous studies have reported positive, null and negative associations between income inequality and SWB.
Objectives: This study reports the first systematic review and meta-analysis of the relationship between income inequality and SWB, and seeks to understand the heterogeneity in the literature.
Methods: This systematic review was conducted according to guidance (PRISMA and Cochrane Handbook) and searches (between January 1980 and October 2017) were carried out using Web of Science, Medline, Embase and PsycINFO databases.
Results: Thirty-nine studies were included in the review, but poor data reporting meant that only 24 studies were included in the meta-analysis. The narrative analysis of 39 studies found negative, positive and null associations between income inequality and SWB. The meta-analysis confirmed these findings. The overall association between income inequality and SWB was almost zero and not statistically significant (pooled r = - 0.01, 95% CI - 0.08 to 0.06; Q = 563.10, I 2 = 95.74%, p < 0.001), suggesting no association between income inequality and SWB. Subgroup analyses showed that the association between income inequality and SWB was moderated by the country economic development (i.e. developed countries: r = - 0.06, 95% CI -0.10 to -0.02 versus developing countries: r = 0.16, 95% CI 0.09-0.23). The association between income inequality and SWB was not influenced by: (a) the measure used to assess SWB, (b) geographic region, or (c) the way in which income inequality was operationalised.
Conclusions: The association between income inequality and SWB is weak, complex and moderated by the country economic development.
Keywords: Happiness; Income inequality; Life satisfaction; Redistribution; Subjective well-being.