JOEI
Starting from January 1, 2008, Journal of Economic Inequality has become the official journal of ECINEQ.
Browse past volumes and issues
Original Paper, Pages 295-322
Measuring multidimensional inequality of opportunity
Marek Kapera, Martyna Kobus, Vito Peragine
This paper extends the measurement of inequality of opportunity (IOP) to the case in which individual outcomes are multidimensional (e.g. income, health). From the outset, we adopt an axiomatic approach to the construction of IOP measures, as opposed to univariate measures that have been proposed rather ad hoc. We characterize two classes of social welfare functions, each endorsing Ex-ante Compensation but different reward principles: (1) utilitarian and (2) inequality averse. For each class we develop implementable conditions analogous to Lorenz dominance and IOP measures. As a major result we axiomatically characterize a multidimensional inequality of opportunity index corresponding to the Tsui (J. Econ. Theory 67(1), 251–265 1995) inequality index applied to the framework of equality of opportunity. The measure is sensitive to dependence between outcomes – a distinctive feature of multidimensional distributions, and has a straightforward interpretation. Using the 2019 wave of EU SILC data we show that the multidimensional analysis of inequality of opportunity in Europe reveals important differences with respect to the analysis based on income alone.
Original Paper, Pages 323-347
Monetary policy shocks and their effects across the wealth distribution: evidence from new European data
Simone Cima, Marco Moreno
We use new data on the distribution of wealth in the euro area and employ panel local projections to estimate the different impact of ECB monetary policy shocks on households across the wealth distribution. We look at how policy affects the value of their assets, the composition of their balance sheets, their investment decisions, and overall wealth inequality. We find that in response to a contractionary shock, poorer households display a substantial decline in their assets and in their overall net wealth. Conversely, the overall wealth of the very richest is not significantly affected. This different response leads to a moderate increase in overall wealth inequality. We further perform a decomposition of asset movements caused by the shock, isolating the effect of revaluations and of household investment. We observe that the response of household wealth due to a monetary policy shock occurs primarily through revaluation effects.
Original Paper, Pages 349-369
Heritability and public policy – a reappraisal
Cornelius A. Rietveld
Economists firmly disagree on the public policy relevance of heritability studies. Going beyond a descriptive interpretation of the variance component estimates in these studies, I propose a quasi-experimentally controlled comparison of the estimates in a gene-environment interaction framework. If the environments individuals are exposed to are under such control in this model, changes in the variance components underlying inter-individual differences can be ex-post informative regarding the evolvement of equality of opportunity in a population. Using administrative data from the Netherlands, I empirically illustrate this reappraisal of heritability studies by estimating two different gene-environment interactions in test scores from a high-stakes national educational achievement test. Most interestingly, genes and the family environment together disproportionally explain test scores of younger-for-grade pupils.
Original Paper, Pages 371-397
Ageing unequally in Latin America
Javier Olivera
Latin American countries. For this purpose, a multidimensional index of active ageing is estimated for each individual, as well as its distribution in each country. This strategy makes it possible to measure inequalities in the ageing process, and also to consider different value judgements in the overall assessment of well-being during ageing. Thus, the study sheds light on discrepancies in the quality of ageing within and between countries. Furthermore, individual factors associated with the degree of inequality in active ageing are analysed by means of regressions using Gini re-centred influence functions. A higher proportion of people with secondary education and better access to water and sewerage services is found to be associated with reduced inequality in active ageing. Country-level variables — such as health expenditure, pension coverage, access to health care and the poverty rate among older people — are key in explaining between-country differences in active ageing.
Original Paper, Pages 399-422
Levelling the playing field? SES differences in graduate degree choices
Judith M. Delaney, Paul J. Devereux
In many countries, subsidies towards higher education and financial assistance to students from poorer backgrounds have reduced socio-economic status (SES) gaps in the types of undergraduate degrees obtained. The increasing importance of graduate studies that are typically more expensive may, however, provide a new avenue for outcome differences by SES. We use administrative data from Ireland that allows us to explore SES differences while taking account of the exact undergraduate programme of study as well as a rich set of other controls. When we do this, we find differences by SES in the probability of undertaking graduate study and larger differences in the type of graduate programme entered. Low SES students are less likely to enter economics/business fields and more likely to enter education programmes – the lowest SES group enter fields of study with expected earnings that are, on average, about 3% lower compared to the highest SES group. We find that, at age 33, students in the lowest SES group who studied a graduate degree earn about 10% less compared to their highest SES counterparts – even for this high achieving group of graduates, those from the poorest backgrounds still earn significantly less than those from the most privileged backgrounds. Interestingly, we find choice of graduate programme of study can explain about 40% of this pay gap.
Original Paper, Pages 423-450
A lost generation? The impact of COVID-19 on high school students’ achievements
Dalit Contini, Maria Laura Di Tommaso, Caterina Muratori, Daniela Piazzalunga, Lucia Schiavon
This paper estimates the effect of a full year of the Covid-19 pandemic on school performance in Italy, focusing on students at the end of upper secondary school who are about to enter the labour market or start university without having had the opportunity to recover. Using longitudinal data from standardised tests for the student population nationwide, we use difference-in-differences models to analyse the performance of two cohorts of students: a cohort that has never been exposed to the pandemic and the cohort that graduated in 2021. We find that the pandemic had a substantial negative impact on students’ performance in mathematics and reading (approximately 0.4 s.d. in both domains). A similar loss is observed in 2022, suggesting no recovery post-pandemic. Low-achieving students suffered the most, widening the gap between strong and poor performers. The relative position of girls compared to boys improved. Contrary to the findings of the existing international literature, inequalities by parental education remained largely unchanged.
Original Paper, Pages 451-485
Consumption and borrowing: Land-holding inequality and the effects of cash transfers
Abhishek Shaw, Sawan Rathi, Anindya S. Chakrabarti
A rich literature shows that in developed countries, cash windfalls increase consumption and are often used to pay off debt. Does inequality influence how cash transfers affect consumption and borrowing, in developing countries? In this paper, we study an unconditional cash transfer program for agricultural landowners in India in a quasi-natural experiment set up. In aggregate, cash transfers led to an increase in consumption alongside increase in borrowings on the extensive margin. Farmers with large land holdings increased only bank borrowings, whereas small and marginal farmers increased both consumption and borrowing from banks – with heterogeneous effects across quartiles. There are no effects on landless agricultural laborers. These effects appear after cash disbursement and not when the announcement was made. Our results suggest that as landholding size increases, households tend to respond more through formal borrowing than consumption.
Original Paper, Pages 487-507
The earnings distribution in Lithuania: the role of the minimum wage
Nerijus Černiauskas, Jose Garcia-Louzao
In this paper, we investigate how the minimum wage has shaped the earnings distribution in Lithuania between 2010 and 2019. We rely on a distribution regression framework and detailed Social Security records to characterize the earnings distribution along with the minimum wage incidence at a monthly frequency. According to our preferred estimates, our results imply that minimum wage increases can explain about 32% (40%) of the decline in total (bottom-tail) earnings inequality and up to 20% of average earnings growth.
Original Paper, Pages 509-530
Smoothed instrumental variables quantile regression estimation of wage inequality in the MENA region
Obbey Elamin
This study examines the factors that impact wage inequality using micro-data from the Middle East and North Africa (MENA) region. We use cross-sectional data from the Labour Marker Panel Survey in Egypt, Jordan, Sudan, and Tunisia and the smoothed instrumental variables quantile regression (SIVQR) method. Our estimation technique has the advantage of being less sensitive to weak instrumental variables than the conventional IV quantile regression. Our model shows that education, overeducation, gender, employment sector, and contract type have causal effects on wage inequality. Gender is the strongest source of wage inequality and the size of the wage gap related to wages. By contrast, the lowest wage inequality exists in the return on education, which indicates that education can tackle the inequality problem. We recommend that governments in the region should adopt policies and reform institutions in the labour market to redirect wage gap trends towards eliminating them to cope with globalisation and technological challenges. Governments in MENA should work to reduce wage inequality by fighting gender discrimination and activating legal frameworks that enforce equity.
Original Paper, Pages 531-555
Study strategies during emergency-related distance learning. The role of gender and field of study
Piera Bello, Annalisa Cristini, Anna Maria Falzoni, Federica Origo
We study the impact of distance learning on students’ exam choices and achievement in higher education, pointing to the mediating role of the field of study and gender. Identification relies on the exogenous shift from in-person to online teaching during the second semester of the 2019–2020 academic year in Italy due to the sudden outbreak of COVID-19. We estimate Difference-in-Differences models using administrative data for different cohorts of students from the University of Bergamo in Northern Italy. Results show that online teaching during the pandemic is associated with a lower number of credits earned and with an increase in the average grade; both outcomes are associated with a reduction in the number of exams, while postponing tougher exams pays only in terms of grades. Additional analyses provide evidence for significant heterogeneity by field of study and gender, with women in engineering degrees being those whose performance declined the most, especially in terms of passed exams. Survey evidence suggests that these results may be explained by gender differences in study-life balance, well-being and learning efficacy related to the lack of in-person relations with both peers and teachers.
Original Paper, Pages 557-587
Inequalities in educational achievement: effect of group capabilities
Diptanshu Gaur, Abhay Pant, Dheeraj P. Sharma
Past research indicates that equitable distribution of resources to control educational achievements inequalities received limited success. Therefore, there is a need to find alternative solutions. Consequently, this study examines the role of group capabilities in improving children’s educational achievements. The extant literature explains group capabilities as a combination of externally and internally defined collectives. Externally defined collectives consider individual membership of social groups by birth. While internally defined collectives consider individual voluntary membership of the social institutions. Using country-level data, the findings of this research reveal that membership of professional and financial groups has positive effects on educational achievements. However, membership of event groups and marginalized social groups negatively impacts achievements. Furthermore, the study explores the moderating role of externally defined collectives in the relationship between internally defined collectives and educational achievements. The study offers several interesting findings that may guide policymakers. They can consider encouraging membership of professional and finance groups and social harmony to augment educational achievements. Furthermore, policymakers can adopt preventive measures to control the negative effect of events group membership.
Original Paper, Pages 589-599
The mth Gini index estimator: Unbiasedness for gamma populations
Roberto Vila, Helton Saulo
This paper establishes the theoretical result that the sample mth Gini index is an unbiased estimator of the population mth Gini index, introduced by Gavilan-Ruiz et al. (2024), for gamma-distributed populations, extending and generalizing the key finding of Baydil et al. (2025). An illustrative Monte Carlo simulation study is performed to numerically check that our implementation recovers the theoretical unbiasednes of the sample mth Gini index estimator in finite samples.
Correction, Pages 601-602
Correction to: Distributional divergence as a unifying measurement framework
Casilda Lasso de la Vega, Juan Gabriel Rodríguez, Rafael Salas
Correction, Pages 603-604
Correction to: Thinking about need
Alexander Max Bauer, Adele Diederich, Stefan Traub, Arne R. Weiss