Estimating labour‐income‐based inequality of opportunity for a selection of EU‐SILC countries: National and urban–rural perspectives

Abstract

This paper measures the extent of inequality of opportunity at the national level and by degree of urbanization. Using data from the European Union Statistics on Income and Living Conditions (EU-SILC), we implement regression models to measure the share of the variation in individuals' labour income that is due to uncontrollable circumstances, namely the relative importance of parental education, activity status of parents, occupation of father and household financial situation. Our results indicate that the level of inequality of opportunity at the country level ranges between 5% and 26% for the sample of countries studied. The analysis by degree of urbanization does not provide evidence of cities as social elevators compared with less urbanized regions.

Determinants of individual income in EU countries: implications for social policy targeting

“…As Campbell (2021) explains, metropolitan residents experience a higher living costs compared to rural areas so they need higher income. On the other hand, Mogila et al (2022) based on a regional analysis using EU-SILC data did not reveal substantial differences between urban and non-urban areas. The last frequently discussed determinant of household income is the household composition.…”

“…Similarly, Hlasny and Verme (2018) point out the shortcomings of the Gini coefficient and recommend its reweighting. Mogila et al (2022) applied the EU-SILC dataset to search for factors affecting income inequality at the level of selected countries. The EU-SILC dataset has been used in studies not only in the income domain but also in research on living conditions, such as Hollederer and Wildner's (2019) study on the link between income, health and education.…”

“…Kramer et al (2016) explain that the gender pay gap leads to a situation where women do not have equal opportunities to achieve the same living conditions as men. Based on EU-SILC data, Mogila et al (2022) conclude that public interventions should address gender discrimination. Navarro and Salverda (2019) found that men and women have different preferences when choosing jobs.…”

The Role of Circumstances in The Differentiation of Russian Wages

“…Иными словами, неравенство в оплате труда между двумя людьми с идентичным человеческим капиталом может возникать в силу географии -места проживания. Регион проживания как фактор обстоятельств включали в свои модели ряд исследователей (Perez-Mayo, 2019), в том числе с акцентом на степени их урбанизации (Mogila et al, 2020). Региональный эффект в нашей модели будет регистрироваться с помощью пула соответствующих даммипеременных.…”