Mobility as Progressivity: Ranking Income Processes According to Equality of Opportunity

28 Pages Posted: 20 Aug 2001 Last revised: 4 Apr 2022

See all articles by Roland Bénabou

Roland Bénabou

Princeton University - Department of Economics; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Efe A. Ok

Leonard N. Stern School of Business - Department of Economics

Date Written: August 2001

Abstract

Interest in economic mobility stems largely from its perceived role as an equalizer of opportunities, though not necessarily of outcomes. In this paper we show that this view leads very naturally to a methodology for the measurement of social mobility which has strong parallels with the theory of progressive taxation. We characterize opportunity--equalizing mobility processes, and provide simple criteria to determine when one process is more equalizing than another. We then explain how this mobility ordering relates to social welfare analysis, and how it differs from existing ones. We also extend standard indices of tax progressivity to mobility processes, and illustrate our general methodology on intra- and intergenerational mobility data from the United States and Italy.

Suggested Citation

Bénabou, Roland and Ok, Efe A., Mobility as Progressivity: Ranking Income Processes According to Equality of Opportunity (August 2001). NBER Working Paper No. w8431, Available at SSRN: https://ssrn.com/abstract=280284

Roland Bénabou (Contact Author)

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Efe A. Ok

Leonard N. Stern School of Business - Department of Economics ( email )

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