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Lower bounds on inequality of opportunity and measurement error

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  • Balcazar Salazar,Carlos Felipe

Abstract

When measuring inequality of opportunity, researchers usually opt to eliminate within-type variation. Provided that in practice it is impossible to observe all circumstances, this implies that the researcher estimates a lower bound of the true level of inequality of opportunity. By using data drawn from 27 Demographic Household Surveys (circa 2008), it is found that lower bound estimates can have substantial measurement error, and that measurement error can vary considerably across countries. As a consequence, lower bound estimates of inequality of opportunity can demand too little redistribution to equalize inequalities due to circumstances and can make the ?traditional? cross-country comparisons misleading.

Suggested Citation

  • Balcazar Salazar,Carlos Felipe, 2015. "Lower bounds on inequality of opportunity and measurement error," Policy Research Working Paper Series 7379, The World Bank.
    • Handle: RePEc:wbk:wbrwps:7379
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    References listed on IDEAS

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    Cited by:

    1. Ibragimova, Zulfiya & Frants, Marina, 2021. "Measuring income opportunity inequality: A structural review and meta-analysis," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 61, pages 89-109.
    2. Paolo Brunori & Vito Peragine & Laura Serlenga, 2019. "Upward and downward bias when measuring inequality of opportunity," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 52(4), pages 635-661, April.
    3. Rafael Carranza, 2023. "Upper and Lower Bound Estimates of Inequality of Opportunity: A Cross‐National Comparison for Europe," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 69(4), pages 838-860, December.
    4. Paul Hufe & Andreas Peichl & Daniel Weishaar, 2022. "Lower and upper bound estimates of inequality of opportunity for emerging economies," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 58(3), pages 395-427, April.
    5. Lianying Yao & Xiaoxiao Ma, 2022. "Has digital finance widened the income gap?," PLOS ONE, Public Library of Science, vol. 17(2), pages 1-20, February.

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    More about this item

    Keywords

    Science Education; Gender and Law; Equity and Development; Scientific Research&Science Parks; Inequality;
    All these keywords.

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D39 - Microeconomics - - Distribution - - - Other
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General

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