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The Roots of Inequality – Is Inequality also Unjust?

Paolo Brunori, Paul Hufe, Daniel Mahler
ifo Institut, München, 2018

ifo Schnelldienst, 2018, 71, Nr. 05, 18-22

The public discussion on social justice in Germany pre-dates the last federal election campaign. In this debate, reference is often made to the development of income inequality. For a meaningful answer to the question of fairness, however, a comparison with historical or international reference points is only helpful to a certain extent. Instead, the concept of fairness should first be clarified. Paolo Brunori, University of Florence, Paul Hufe, ifo Institute and Daniel Mahler of the University of Copenhagen present a new measurement concept for a wide-spread ideal of fairness: the idea of equal opportunity. Equal opportunity means that the ability to earn a living does not depend on factors that are beyond personal influence. According to the authors' calculations, about 25 percent of income inequality can be attributed to an uneven distribution of opportunities, with success in life being influenced above all by the education and profession of the father.

JEL Classification: I310, I300, D310

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ifo Institut, München, 2018