The Influence Premium of Monetary Rank

Abstract

The transmission of adaptively valuable behaviours requires successful individuals to exert greater influence on others’ actions. Hierarchical social organisations ease the recognition of successful, higher ranked individuals in a group, and hence facilitate this process. We investigate whether purely monetary rank, defined exclusively in terms of the amount of resources held by an individual, is capable, in isolation of any other intervening mechanism, to grant greater influence over others’ choices. Among a representative sample of the German population, we find that high monetary rank grants individuals greater influence over others’ actions.

Keywords: Inequality, Status, Social influence, Ability

JEL Classification: C91, D02, D31