# _The concept and measurement of equality of opportunity_

Underlying the idea of an opportunity society is the principle of equality of opportunity (see, for example, Roemer, 1993 and 1998 and Van der Gaer, 1993), which states that the "circumstances" a person is born into, such as gender, location, and parental, social and economic background, should not determine opportunities, so that the individual’s outcomes and achievements in life depends only on her effort and innate ability. The principle is based on ideas developed by a long list of influential thinkers on issues of fairness and rights that underscore fairness of process and opportunities rather than outcomes.<sup>26</sup> While the definition of “opportunities” is subjective and oft debated in the development literature, a minimal definition that most societies can agree on is that of a set of basic goods and services for children, such as (but not limited to) safe water, adequate sanitation, nutrition and primary schooling (see Barros and others, 2009). This minimalist view equates opportunity with access to basic goods and services in the early life of an individual, which improve the likelihood to maximize his/her human potential, and in most cases are considered basic economic and social rights. Focusing on access to basic goods and services also underscores the notion of _multi-dimensional welfare that lies at the heart of the idea of shared prosperity_ .

Defined as above, most societies can also agree on equality of opportunities being a worthy goal to aspire toward. Promoting equality of opportunities has an intuitive appeal that transcends ideological difference, as it is fundamentally about equity – how level is the playing field for individuals – and not about equalizing outcomes. In many instances, it offers a way out of the sometimes politically polarizing debate over inequality. Agreement on the principle of equality of opportunity across the ideological spectrum can create a basis for action in society, even if there are still deep disagreements on the policies and the role of state vis-à-vis markets to translate these principles into action. To aid this process, systematic ways for countries to measure progress toward providing opportunities to all its citizens are needed. Responding to this need, researchers within the World Bank and outside have adopted a number of different ways to measure opportunities, including an intuitive measure named the “Human Opportunity Index” (HOI), which has been applied to a number of countries (Barros and others, 2009 and 2010).<sup>27</sup>

# _Opportunities, growth and shared prosperity – a virtuous cycle_

The arguments above make the case for how equality of opportunity is fundamental to the idea of an equitable society with a level playing field for all individuals. The World Bank’s 2006 World Development Report argues that inequality of opportunity weakens prospects for overall prosperity and economic growth. While research on the causal impact of inequality of opportunity at the macro level is at a nascent stage, some evidence suggests that such inequality has an adverse impact on growth and development. Inequality of opportunity in education among children seems to have a negative impact on per capita income (Molina and others 2012). There seems to be a negative relationship between the component of income inequality attributable to circumstances and economic growth across the states in United States (Marrero and Rodriguez, 2010). _Inequality_ in health, proxied by the gradient in child mortality over mothers’ education groups, has a significant negative impact on economic growth, possibly explained by how health inequality affects average labor productivity (Grimm, 2011).<sup>28</sup> New research by Skoufias and others (as cited earlier) also finds some suggestive evidence on a robust negative relationship between inequality of opportunity and income growth of the bottom 40 percent of the income distribution across provinces ( _changwats_ ) in Thailand.

Micro-level studies find strong evidence linking interventions to equalize opportunities earlier in life to better outcomes in adult life, and that early interventions are significantly more cost-effective and successful than those attempted later in life. Research shows that preschoolers with low levels of cognitive development have lower school achievement and earn lower wages in adulthood (Currie and Thomas, 1999; Case and Paxson, 2006); and that early childhood education has substantial long-term impacts, ranging from adult earnings to retirement savings (Chetty and others, 2010). Moreover, lost 15