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Equality of opportunity: Theory and evidence

Author

Listed:
  • Francisco H. G. Ferreira

    (World Bank, USA)

  • Vito Peragine

    (University of Bari, Italy)

Abstract

Building on earlier work by political philosophers, economists have recently sought to define a concept of equity that accommodates the fairness of reward to individual responsibility and effort, while allowing for the existence of some inequalities which are unfair and should be compensated. This paper provides a critical review of the economic literature on equality and inequality of opportunity. A simple 'canonical model' of equal opportunity is proposed, and used to explore the two fundamental concepts in this (relatively) new theory of social justice: the principles of compensation and reward. Ex-ante and ex-post versions of the compensation principle are presented, and the tensions between them are discussed. Different approaches to the measurement of inequality of opportunity - and empirical applications - are reviewed, and implications for the measurement of poverty and of the rate of economic development are discussed.

Suggested Citation

  • Francisco H. G. Ferreira & Vito Peragine, 2015. "Equality of opportunity: Theory and evidence," Working Papers 359, ECINEQ, Society for the Study of Economic Inequality.
  • Handle: RePEc:inq:inqwps:ecineq2015-359
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    File URL: http://www.ecineq.org/milano/WP/ECINEQ2015-359.pdf
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    More about this item

    Keywords

    Equality of opportunity; inequality of opportunity; compensation; reward.;
    All these keywords.

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty

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