Chapter 7 Income Inequality and Inequality of Opportunity in Europe: Are They on the Rise?

Álvarez, Ana Suárez; Menéndez, Ángel Espiniella

doi:10.1108/s1049-258520180000026008

Cited by 8 publications

(3 citation statements)

References 24 publications

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“…circumstances are all the things that account for people's incomes and are beyond their control (and for which, therefore, they cannot be held responsible), (b) types are groups of individuals who share the same circumstances, (c) the individuals belonging to a type share a common opportunity set, i.e., a set of income prospects, (d) the value of each opportunity set is measured by the mean of the realized incomes of those belonging to the type, (e) absolute inequality of opportunity (AIOpI) is the inequality in opportunity-set values across individuals, and (f) relative inequality of opportunity (RIOpI) is the share of a society's overall inequality that is deemed unfair under the luck-egalitarian perspective, that is, AIOpI as a share of overall inequality. Using this approach, the IOpI literature has produced estimates for many countries and-like the economic mobility literature-has made comparing countries in terms of their IOpI levels a central goal (e.g., Björklund, Jäntti and Roemer 2012;Brunori, Ferreira and Peragine 2013;Checchi, Peragine, and Serlenga 2010;Ferreyra and Gignoux 2011;Hufe et al 2017;Marrero and Rodríguez 2012;Pistolesi 2009;Suárez Álvarez and López Menéndez 2019).…”

Section: Luck Egalitarianism and Inequality Of Opportunity For Incomementioning

confidence: 99%

Inequality of Opportunity, Income Mobility, and the Interpretation of Intergenerational Elasticities, Correlations, and Rank-Rank Slopes

Mitnik

2024

Preprint

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Although there is an extensive methodological literature on the measurement of income mobility, there has been little research on the conceptual interpretation of mobility measures and the methodological implications of those interpretations. In this article, I focus on the three measures of mobility that havemost often been used in the literature—the intergenerational elasticity (IGE), the intergenerational correlation (IGC), and the rank-rank slope (RRS)—as well as a recently introduced measure, the intergenerational elasticity of expected income (IGEE). I make three contributions, all related to the conceptual interpretation of mobility measures. First, I specify the formal relationships between those four mobility measures and the measures of inequality of opportunity developed in the luck egalitarian empirical literature on the topic and determine the methodological implications of the analyses. I show that (a) the IGC is a measure of relative inequality of opportunity for monetary income, (b) the RRS is both a measure of relative inequality of opportunity for income rank and a rescaled-by-a-constant measure of absolute inequality of opportunity for income rank, and (c) the products of parental income inequality by the IGEE and IGE are both measures of absolute inequality of opportunity for monetary income that differ in how they measure the value of opportunity sets. Second, I show that an oft-repeated argument, positing that the IGC and RRS are conceptually superior to the IGE because they are not affected by changes in cross-sectional inequality, is based on misinterpreting a mathematical identity without any empirical content as a directed causal relationship and is inconsistent with the results of a formal analysis of the joint dynamics of inequality, the IGE, and the IGC. Lastly, I show that a characterization of the IGE and IGEE as, respectively, “person-weighted” and “dollar-weighted” elasticities is the joint result of a category mistake—equating quantile-specific elasticities to person-specific elasticities—and of misconstruing the nature of the IGE and the epistemic goal it has been meant to serve.

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Section: Luck Egalitarianism and Inequality Of Opportunity For Incomementioning

confidence: 99%

Inequality of Opportunity, Income Mobility, and the Interpretation of Intergenerational Elasticities, Correlations, and Rank-Rank Slopes

Mitnik

2024

Preprint

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“…7 7 As noted by Suárez‐Álvarez and López‐Menéndez (2017), the non‐parametric method‐based estimates tend to be less accurate when the set of circumstances is large.…”

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confidence: 99%

“…3 3 As Suárez‐Álvarez and López‐Menéndez (2017) point out, the methods of measuring inequality of opportunity might be also split into three categories, that is, those based on stochastic dominances analyses, those relying on the concept of fair allocation and those related to the construction of counterfactual distributions.…”

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confidence: 99%

Estimating labour‐income‐based inequality of opportunity for a selection of EU‐SILC countries: National and urban–rural perspectives

Mogiła

Melo

Gaspar

2022

Regional Science Policy & Practice

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This paper measures the extent of inequality of opportunity at the national level and by degree of urbanization. Using data from the European Union Statistics on Income and Living Conditions (EU-SILC), we implement regression models to measure the share of the variation in individuals' labour income that is due to uncontrollable circumstances, namely the relative importance of parental education, activity status of parents, occupation of father and household financial situation. Our results indicate that the level of inequality of opportunity at the country level ranges between 5% and 26% for the sample of countries studied. The analysis by degree of urbanization does not provide evidence of cities as social elevators compared with less urbanized regions.

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Exploring Perceptions About Opportunities and Immigration

Álvarez

Menéndez

2022

The Palgrave Handbook of Global Social Problems

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Chapter 7 Income Inequality and Inequality of Opportunity in Europe: Are They on the Rise?

Cited by 8 publications

References 24 publications

Inequality of Opportunity, Income Mobility, and the Interpretation of Intergenerational Elasticities, Correlations, and Rank-Rank Slopes

Inequality of Opportunity, Income Mobility, and the Interpretation of Intergenerational Elasticities, Correlations, and Rank-Rank Slopes

Estimating labour‐income‐based inequality of opportunity for a selection of EU‐SILC countries: National and urban–rural perspectives

Exploring Perceptions About Opportunities and Immigration

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