Inequality of Opportunity in Monthly Wages in the Jordanian Labor Market

This paper quantifies the inequalities of opportunities in monthly wages in the Jordanian labor market, drawing on Roemer (1993)’s distinction between circumstances and other unobserved/unexplained variables (luck, endowed genetics, culture, native ability) which for convenience we call effort. I borrow the parametric approach developed by Bourguignon, Ferreira, and Menéndez (2007) to calculate the shares of “unfair” inequality and analyze the main drivers of inequality of opportunity for the entire population and gender/birth region subgroups, using the nationally representative Jordan labor market panel surveys for 2010 and 2016. Also complementary analyses of inequality of opportunity was conducted; the stochastic dominance test and generalized lorenz curves Lefranc, Pistolesi, and Trannoy (2008), which allowed to visualize the magnitude of the inequality of opportunities. Inequality of opportunity shares are small and decline in the second survey wave. Women and both north and south-born subgroups experience greater unfair inequality. The main drivers across the sample are parental education, father’s occupation, and employment sector. Stochastic dominance tests confirm advantages for individuals with publicly employed fathers, white-collar fathers, highly educated parents, and men.Length: 36