Fair Inequality: Most Income Disparities are Not Due to Inequality of Opportunity

We ask: how much less would societal income inequality be in the hypothetical absence of disparities due to either gender or parental advantages, including their family wealth, connections, and ethnic group? Measured by a new interpretation of the Gini coefficient, we term this quantity “fair inequality.” We find that for most of the 15 countries in our global North and South data set the expected market income differences between members of randomly drawn pairs from the population are on average less than one-third greater than the expected income difference between the members of a randomly drawn pair of same-sex siblings. We also demonstrate that other indices commonly thought to measure parental advantage (or its absence) systematically understate the degree of fair inequality. In closing we will reflect on the normative reasons for egalitarian redistribution in light of our findings.