TY  - RPRT
        AU  - Hufe, Paul
AU  - Kanbur, Ravi
AU  - Peichl, Andreas
        TI  - Measuring Unfair Inequality: Reconciling Equality of Opportunity and Freedom from Poverty
        PY  - 2018/Jun/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 11601
        UR  - https://www.iza.org/publications/dp11601
        AB  - Rising income inequalities are widely debated in public and academic discourse. In this paper, we contribute to this debate by proposing a new family of measures of unfair inequality. To do so, we acknowledge that inequality is not bad per se, but that its underlying sources need to be taken into account. Thereby, this paper is the first to reconcile two prominent fairness principles, namely equality of opportunity and freedom from poverty, into a joint measure of unfair inequality. Two empirical applications provide important new insights on the development of unfair inequality both over time (in the US) and across countries (in Europe). First, unfair inequality shows different time trends and country rankings compared to total inequality. Second, average unfair inequality doubles when complementing the ideal of an equal opportunity society with poverty aversion. Furthermore, we show that an exclusive focus on top incomes may misguide fairness judgments.
        KW  - poverty
KW  - equality of opportunity
KW  - inequality
KW  - fairness
KW  - measurement
        ER  -