Psychologists have been tracking the phenomenon of ‘biased self-perception’ for years now. But new research suggests that they’ve been blaming the wrong social culprit.

People quite full of themselves populate every society, and, in fact, most all of us have at one time or another exaggerated our talents and character. Psychologists know this phenomenon well. They even have a term of art for it: “biased self-perception.”[pullquote]Culture doesn’t explain national differences in ‘biased self-perception.’ But economic inequality does.[/pullquote]

Psychologists have also understood, for many years now, that levels of “biased self-perception” can vary substantially from one society to the next. Japan, for instance, sports much less “biased self-perception” than the United States.

Investigators have generally credited that difference to meta cultural differences. Cultures in the United States and the rest of the West, the argument goes, value “personal success and uniqueness.” In Japan and the East, culture places more value on “interpersonal harmony and belonging.”

But new research recently published in the journal Psychological Science — by a team of 19 psychologists from all around the world — directly challenges this meta cultural cast on “biased self-perception.”

Psychologist Steve Loughnan from Britain’s University of Kent and his fellow researchers have studied survey responses from over 1,600 people in 15 different countries. They’ve concluded that culture doesn’t explain national differences in “biased self-perception.” But economic inequality does.

People in more unequal societies — like Singapore and the United States — “tend to view themselves as superior to others,” the psychologists found. On the other hand, people in societies with less income inequality — Japan and Germany, for instance — “tend to see themselves as more similar to their peers.”

Why does inequality have this impact? Loughnan and his colleagues do some speculating. In more unequal societies, the psychologists point out, the gaps — and rewards — that divide people run more extreme. Where you stand in the pecking order matters more. The pressure from that mattering may create some powerful motivation for people to want “to stand out as superior to others.”

In more equal societies, the researchers surmise, people may feel “a pressure to seem more similar to others.” This pressure encourages modesty and discourages people from spouting off about their superiority to others, be that superiority real or just perceived.

Social scientists have postulated this dynamic in the past, most recently in a landmark 2010 book by epidemiologists Richard Wilkinson and Kate Pickett. Loughnan and his investigative team have now backed up those projections with compelling data.

In the process, Loughnan’s team has offered up to us still another glimpse at how economic inequality is souring the daily lives we all lead.