All Social Comparisons are Local? Inequality, Coethnicity and Subjective Economic Position

Abstract Recent studies have found that the self‐perceived, rather than the objective, economic position affects individual political behavior. But how do individuals self‐assess their own position? In this paper, we study how local conditions – local inequality and coethnicity – affect this self‐assessment. We assume that individuals take information from their immediate environments and compare themselves to those that are nearest to them, both spatially but also socially (i.e. their coethnics). We use geo‐coded Afrobarometer survey results from 20 countries, satellite data on nightlight emissions a spatial data on ethnic settlement regions to study how citizens' perceived economic position depends on the inequality surrounding them. Our results show that local inequality makes individuals perceive their economic status as more extreme (rich or poor). However, counter to our expectations, we find this effect primarily among members of local ethnic minorities.