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2023 | OriginalPaper | Chapter

19. Measurement of Multidimensional Inequality of Opportunity in India

Authors : Sayli Javadekar, Jaya Krishnakumar

Published in: India’s Contemporary Macroeconomic Themes

Publisher: Springer Nature Singapore

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Abstract

In recent years, the discussion on distributional analysis for social justice has increasingly focused on inequality in opportunities and basic life chances rather than inequality in earnings. A suitable framework for analyzing equality of opportunity is that of Roemer (Theories of distributive justice. Harvard University Press, 1993) with the idea that any outcome is the fruit of aspects within individual responsibility, i.e., individual effort, and aspects beyond individual control, e.g., family background characteristics. The contribution of this paper is threefold; (i) to consider wellbeing in the work domain as a multifaceted concept and model it through a latent variable model; (ii) to estimate and analyze the inequality of opportunity (IOp) in work wellbeing in a multidimensional setting, taking into account the endogeneity of effort; and (iii) to apply the model to Indian data to estimate the shares of circumstances like religion, caste, household size, land, age, place of residence, and years of schooling, in the inequality of opportunity in work wellbeing. We also compare these shares with those obtained for a unidimensional outcome, across regions and over time.

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Footnotes
1
In reality, there is also a third factor “luck” or random shocks. However, inclusion of “luck” in empirical analysis depends on the availability of information. Theoretically “luck” can take different forms—brute luck and option luck. When an individual cannot alter the possibility of the occurrence of an event, it is called brute luck. While option luck is defined as the luck that arises when an individual takes some calculated risks. For further discussion on the treatment of “luck” for EOp see (Lefranc et al., 2009).
 
2
The rank on the outcome distribution would be the same as the rank on the effort distribution as effort is monotonic in outcome.
 
3
We assume a single latent variable in our empirical application; however an extension to a vector of latent variables is relatively straightforward.
 
4
We used a scalar circumstance variable in our derivation; in practice, we will have a vector of observed circumstances Ci and a vector of corresponding coefficients β1 premultiplying it in the equation.
 
5
\({z_{{u_{i} }}}\) could be the entire vector Ci or could include only a few selected circumstances.
 
6
NSSO.
 
7
We use log of monthly per capital expenditure in the regressions.
 
9
As a sensitivity analysis, we estimate conditional variances excluding covariates not significant in Tables 19.5 and 19.6. The final IOp shares are robust to changes in the conditional variances. Results available on request.
 
10
Wi would capture the part of unobserved circumstance that is independent of observed circumstance plus random error (see Eq. 19.23 in the Appendix below).
 
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Metadata
Title
Measurement of Multidimensional Inequality of Opportunity in India
Authors
Sayli Javadekar
Jaya Krishnakumar
Copyright Year
2023
Publisher
Springer Nature Singapore
DOI
https://doi.org/10.1007/978-981-99-5728-6_19