Equalization of Opportunity: Definitions, Implementable Conditions and Application to Early-Childhood Policy Evaluation.
Luxembourg Institute of Socio-Economic Research (LISER) Working Paper Series 2014-12
60 Pages Posted: 7 Jun 2015
Date Written: November 18, 2014
This paper develops a criterion to assess equalization of opportunity that is consistent with theoretical views of equality of opportunity. We characterize inequality of opportunity as a situation where some groups in society enjoy an unfair advantage. In this context, equalization of opportunity requires that the extent of the advantage enjoyed by the privileged groups falls. Robustness requires that this judgement be supported by the broadest class of individual preferences. We formalize this criterion in a decision theoretic framework, and derive an empirical condition for equalization of opportunity based on observed opportunity distributions. The criterion is used to assess the effectiveness of child care at equalizing opportunity among children, using quantile treatment effects estimates of a major child care reform in Norway. Overall, we find that the child care reform significantly equalized opportunity among Norwegian children.
Keywords: Equality of opportunity, public policy, inverse stochastic dominance, economic distance, income distribution, child care, pre-school
JEL Classification: D63, J62, C14, I24
Suggested Citation: Suggested Citation