Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/150940 
Year of Publication: 
2011
Series/Report no.: 
SOEPpapers on Multidisciplinary Panel Data Research No. 395
Publisher: 
Deutsches Institut für Wirtschaftsforschung (DIW), Berlin
Abstract: 
Previous estimates of unfair inequality of opportunity (IOp) are only lower bounds because of the unobservability of the full set of endowed circumstances beyond the sphere of individual responsibility. In this paper, we suggest a new estimator based on a fixed effects panel model which additionally allows identifying an upper bound. We illustrate our approach by comparing Germany and the US based on harmonized micro data. We find significant and robust differences between lower and upper bound estimates - both for gross and net earnings based either on periodical or permanent income - for both countries. We discuss the cross-country differences and similarities in IOp in the light of differences in social mobility and persistence.
Subjects: 
Equality of opportunity
fairness
redistribution
wage inequality
JEL: 
D31
D63
H24
J62
Document Type: 
Working Paper

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