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Nonparametric analysis of heterogeneous multidimensional fairness

Working Paper 2022-621

Abstract

The paper proposes a framework to assess fairness in multidimensional distributions while respecting individual preferences. We characterize a simple measure – Equivalent Advantage – that captures the distance from the current outcome to the potentially individual specific norm outcome. We introduce a nonparametric approach to partially identify our measure via set identification of individual indifference curves. Our methodology is illustrated by analyzing multidimensional fairness in Belgium using the MEqIn database. Despite the set identification, we show that our analysis of the Equivalent Advantage distribution allows for interesting insights on multidimensional inequality, poverty and opportunity distribution.

Authors: Domenico Moramarco, Bram De Rock.

Keywords: fairness, multidimensional inequality, poverty, equality of opportunity, Equivalent Advantage, individual preferences, nonparametric analysis
JEL: D30, D63, I14, I32