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Inequality in Focus, January 2014: How Poverty Affects Aspirations; Gap Between Facts and Perceptions of Inequality

In this issue...
  • we explore how and why low aspirations are perpetuated across generations, as well as links to inequality and unrest.
  • we explain the overlap and the gap between facts and perceptions of inequality, and discuss the relevance of both in policy interventions.

The quarterly newsletter Inequality in Focus continues to explore aspects of inequality, this time delving into how poverty can limit aspirations and exploring the gap between facts and perceptions of inequality. Access the latest issue here.


Aspiration Traps: When Poverty Stifles Hope

Parents from lower socioeconomic backgrounds often have limited hopes for their children's educational and professional success. In many cases, this low expectation can translate into the children themselves underestimating their potential and future path, trapping them in a negative cycle throughout their lives. Author Svenja Flechtner digs deeper into this phenomenon, exploring possible causes, links to inequality and social unrest, and potential policy and research interventions to counter the negative effects of aspiration traps. Read full article here.

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Aspiration traps are particularly harmful to people at the bottom of the socioeconomic ladder. Poverty and social disadvantages promote low aspiration levels. Close Quotes

Explaining the Gap Between Facts and Perceptions of Inequality

Facts and perceptions of inequality convey equally important, yet different, sets of information about a society. One refers to absolute well-being, in terms of income, and the other refers to well-being relative to others or relative to past well-being. Author Paolo Verme uses recent evidence from Egypt and the United States to illustrate where fact and perceptions of inequality overlap, where they differ, and why this is important. Read full article here.

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People’s perceptions of inequality have to do with their personal beliefs and intrinsic values related to the state of inequality. But what determines these beliefs and values? Close Quotes

Tertiary school enrollment (% gross) in five countries with incidences of protest, 1981–2010

What drives inequality and how does it affect poverty reduction efforts and economic growth? The World Bank's Inequality in Focus newsletter seeks to answer these and many other questions.