Measurement of inequality of opportunity: A normative approach

We develop a normative approach to the measurement of inequality of opportunity. That is, we measure inequality of opportunity by the welfare gain obtained in moving from the actual income distribution to the optimal income distribution of the total available income. Our study brings together the ma...

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Published in:Journal of economic inequality 2021-06, Vol.19 (2), p.213-237
Main Authors: Bosmans, Kristof, Öztürk, Z. Emel
Format: Article
Language:English
Subjects:
Analysis
Development Economics
Economic Growth
Economics
Economics and Finance
Income distribution
Inequality
International Economics
Measurement
Political Science
Public Finance
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description We develop a normative approach to the measurement of inequality of opportunity. That is, we measure inequality of opportunity by the welfare gain obtained in moving from the actual income distribution to the optimal income distribution of the total available income. Our study brings together the main approaches in the literature: we axiomatically characterize social welfare functions, we obtain prominent allocation rules as their optima, and we derive familiar classes of inequality of opportunity measures. Our analysis captures moreover the key philosophical distinctions in the literature: ex post versus ex ante compensation, and liberal versus utilitarian reward.
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subjects Analysis
Development Economics
Economic Growth
Economics
Economics and Finance
Income distribution
Inequality
International Economics
Measurement
Political Science
Public Finance
title Measurement of inequality of opportunity: A normative approach
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