Home Ownership, House Prices, and Belief in Meritocracy: Evidence from South Korea and 34 Countries

Abstract

Do home ownership and house prices impact the shaping of individual perceptions on inequality and belief in meritocracy? We argue that home ownership and rising asset prices increase the salience of an individual’s own relative economic position, which in turn facilitates belief in meritocracy. We expect that, when house prices increase, homeowners are likely to strengthen their belief in meritocracy and defend their position by rationalizing that income distribution in society is fair and that economic success and failure are primarily determined by individual efforts. Our analysis of both a Korean panel survey and a cross-national survey finds strong and robust evidence of the asset price effect. Our findings suggest that the housing price effect on economic ideology is a general pattern, which implies that there are social and political consequences to the asset price effect.