Is all economic inequality bad? Is zero the optimal amount of income inequality? Or, like cholesterol, might there be better and worse forms of inequality? In this talk, World Bank Senior Adviser Francisco Ferreira will discuss how the concept of inequality of opportunity is used by economists. He will briefly review the normative underpinnings and philosophical roots of the theory, provide some empirical illustrations, and then present (some of the) formal economic approaches to the measurement of inequality of opportunity – both for income and education. Limitations and recent attempts to overcome them will also be discussed.
At the end, Francisco will comment on the close relationship between the concepts of inequality of opportunity and socio-economic mobility; and offer a few examples of applications in the areas of economic growth and social policy evaluation.