The above papers have something in common. Structural inequality, educational inequality and inequality of power are symptoms of a more encompassing concept: _inequality of opportunity_ .

The hypothesis we empirically test in this paper is compatible with the above literature. It is based on the idea that factor endowments at the outset of history influenced the type of human capital institutions that each country developed and as a result of that, affect education opportunities among its population. Low and unequal education opportunities tend to create a failure in the political market due to multiple agents (citizens) who vastly differ in their bargaining power, through no fault of their own. All agents do not have the same power to influence the principal (government), since the political power of influence is a function of information, resources and the capability to mobilize groups. In countries where broad segments of the population do not have information, resources or capabilities for mobilization, the politicians are likely to be less accountable, as they recognize that the population is not able to monitor and punish them for their misdeeds.

A recent paper (Jakiela et al. 2010), finds experimental evidence in favor of the idea that improving educational opportunities creates a better environment to design institutions. They combine data from a field experiment and a laboratory experiment to measure the causal impact of educational opportunity on respect for earned property rights. The paper finds that higher academic achievement reduces the willingness of young Kenyan women to appropriate others' labor income, and shifts players toward a 5050 split norm in the dictator game.

Thus it seems reasonable to suggest that greater equality of opportunity promotes more engaged citizens, who have more respect for property rights and more information and intellectual resources to “punish” corrupt principals. To empirically assess such an argument in a cross-country setting, we analyze the extent to which equality of opportunity, which we proxy with measures of educational opportunities, have an impact on development outcomes – namely, the level of economic development and institutional quality at the country level. We also assess the extent to which inequality of outcomes explains variation in GDP per capita or institutional quality, once the level and distribution of opportunities are controlled for (using recently developed measures that are new to the cross-country literature).

While research establishing a causal link between inequality of opportunity and growth in a crosscountry framework is at a nascent stage, the evidence so far seems to suggest that inequality of opportunity has an adverse impact on growth and development. Marrero and Rodríguez (2013), using income-based measures of inequality of opportunity that are quite different from ours, have found such evidence in an entirely different data set. They test the hypothesis that inequality of opportunity (attributable to two circumstances, namely parental education and race) and inequality of effort affect economic growth in different directions, using refined data of the PSID database for 26 states distributed throughout the United States in 1970, 1980 and 1990. They find robust support for a negative relationship between inequality of opportunity and growth and a positive relationship between inequality of effort and growth. While the results are encouraging, the authors acknowledge the need for caution because only two circumstances were used in the analysis, which implies that the results shed no light on the impact of other opportunity-related inequalities (for example, those attributable to parental occupation or 5