Five Studies: The Psychology of the Ultra-Rich, According to the Research

OLIGARCHY

Bernie Sanders says that billionaires have “psychiatric issues.” He’s not entirely incorrect.

By Livia Gershon

Source: Pacific Standard

“Let me tell you about the very rich. They are different from you and me. They possess and enjoy early, and it does something to them, makes them soft where we are hard, and cynical where we are trustful, in a way that, unless you were born rich, it is very difficult to understand. They think, deep in their hearts, that they are better than we are because we had to discover the compensations and refuges of life for ourselves. Even when they enter deep into our world or sink below us, they still think that they are better than we are. They are different.”
—F. Scott Fitzgerald

Bernie Sanders’ unexpectedly popular presidential campaign features a lot of rhetoric that we don’t usually hear in mainstream politics. One striking example is the Vermont senator’s contention that the ultra-rich suffer from “psychiatric issues” that manifest in an addiction to money and a worldview divorced from reality.

When we talk about inequality, we often spend lot of time considering poor people’s attitudes and behaviors, from whether they get married to how they talk to their kids. We’re less likely to stop and look at how the rich are different. But extremely wealthy people play a huge role in increasing inequality. With their heavy political clout, they help shape government economic policies, supporting very different positions from those of average Americans. From their perches on corporate boards and compensation committees they also give direct raises to their fellow oligarchs.

As inequality grows, in the United States and in the world, the shape of the wealthiest classes is also changing. The significance of inherited wealth fell rapidly in the mid-20th century, making way for the “self-made” rich. Now, though, there’s growing evidence that, as Thomas Piketty has famously argued, dynasties are making a comeback.

So there’s good reason to pay at least as much attention to the behaviors and beliefs of the rich as we do to those of the poor. But what does research tell us about the nature of wealth? How does it affect those who have it? Studies suggest the wealthy really do have significant psychological differences from the middle class in how they view money, and how they look at their relationship with society.

1. MONEY BUYS HAPPINESS—KIND OF

Richer people tend to be happier, but not by all that much. And it’s not really right to say money makes them happy. Wealth only makes affluent people more satisfied to the extent that it gives them more control over their own lives, making them feel richer. (Anyone who feels financially and personally stable because they’ve got a steady job, enough money to get them through an emergency, and a nicer house than their neighbor is likely to be happier than the poorest multi-millionaire in a hyper-rich enclave they can’t really afford.) Still, holding everything else equal, people who have more money have more stability. Of course, they also usually know they’re well off. And those two factors make them happier.

—”How Money Buys Happiness: Genetic and Environmental Processes Linking Finances and Life Satisfaction,” Wendy Johnson and Robert F. Krueger, Journal of Personality and Social Psychology, Vol 90(4), Apr 2006

 2. BUT RICH PEOPLE HAVE DIFFERENT CRITERIA FOR HAPPINESS

Asked about what makes people happy, extremely rich Americans, just like average Americans, typically put love first. But the ultra-wealthy are more likely than everyone else to say happiness depends on winning the appreciation and respect of others. They’re also more likely to cite the realization of personal potential as a key to happiness. But they’re much less likely than non-wealthy people to say that physical health is most important. (Perhaps because they’ve never been uninsured?) Rich people are also a bit more likely than the rest of us to say having a lot of money can occasionally present an obstacle to happiness.

—”Happiness of the Very Wealthy,” Ed Diener, Jeff Horwitz, and Robert A. Emmons, Social Indicators Research, April 1985

3. THE WEALTHY ARE MORE AND MORE LIKELY TO IDENTIFY WITH AN INTERNATIONAL ECONOMIC ELITE

Board members of the world’s largest corporations—a significant and influential segment of the ultra-rich—are increasingly likely to serve on the boards of foreign and multinational companies. Even directors who don’t serve on the boards of foreign companies usually interact with others who do. In other words, modern corporate elites are likely to be part of cosmopolitan, global social networks, whereas most poor and middle-class people are more likely to identify with their home populations.

—”Transnationalists and National Networkers in the Global Corporate Elite,” William K. Carroll, Global Networks, June 2009

4. AS A RESULT, THEY’RE NOT GREAT AT EMPATHY

People from higher socioeconomic classes do worse on a test where they’re asked to identify emotions in photographs of human faces. They’re also less accurate at perceiving the emotional states of others in real-life interactions. In fact, researchers can reduce people’s empathy just by prompting them to think of themselves as relatively high-status. Test subjects who are asked to imagine an interaction with someone from a lower social rung get worse at understanding other people’s emotions. The trouble higher-status people have recognizing emotions is tied to the fact that they tend to think about themselves and others in terms of fixed traits (“She’s a nervous person.”) In contrast, people from lower social classes are more likely to use contextual explanations for people’s behavior (“This interview is making her uncomfortable.”)

—”Social Class, Contextualism, and Empathic Accuracy,” Michael W. Kraus, Stéphane Côté, and Dacher Keltner, Psychological Science, October 25, 2010

5. AND THEY THINK DOMESTIC INEQUALITY REPRESENTS JUST DESSERTS

Americans are known for our trust in an ideal of meritocracy. When you ask the general public to assess statements like “most people who want to get ahead can make it if they’re willing to work hard,” well over 70 percent of us agree. But what happens when people see high levels of income inequality in their daily lives? It turns out that low-income Americans are less likely to believe in meritocracy if they live in counties with extreme economic inequality—places where they’re likely to run into much richer people a lot. For high-income people, the effect is exactly the opposite. The study’s authors suggest that rich people could be using a defense mechanism to stave off guilt and justify their relatively privileged position within a visibly unequal system. But, for whatever reason, the more inequality rich people see in their home county, they more likely they are to believe that meritocracy is working.

—”False Consciousness or Class Awareness? Local Income Inequality, Personal Economic Position, and Belief in American Meritocracy,” Benjamin J. Newman, Christopher D. Johnston, and Patrick L. Lown, American Journal of Political Science, April 2015

 

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