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HUMAN OPPORTUNITY INDEX

Disponible en Español

La medición de la desigualdad de oportunidades en América Latina y el Caribe 
  
Leveling Opportunities, Key to Latin American and the Caribbean
 
October 2nd, 2008 -
Between one fourth and one half of income inequality observed among Latin America and the Caribbean adults is due to personal circumstances endured during childhood that fell outside of their control or responsibility, such as race, gender, birthplace, parent’s educational level and their father’s occupation. These circumstances reveal the level of inequality of opportunity in the region

The new Human Opportunity Index, developed by a Group of economists from the World Bank, Argentina and Brazil, shows how personal circumstances play in gaining or preventing access to those services needed for a productive life, such as running water, sanitation, electricity or basic education among children in the region. This opens up a whole new field of study dedicated to designing public policy focused on equity.

 
 
The Human Opportunity Index - HOI - shows
:

» The HOI measures the access to basic services and its distribution under an equality principle.

» The HOI has increased in the basic opportunities of education, water, electricity and sanitation during the last decade.

» The greatest progress was seen in Paraguay, Peru, Brazil, El Salvador, Guatemala, and Mexico.

» Brazil, Colombia, and El Salvador registered the most rapid improvements in education.

» Costa Rica, Guatemala, Paraguay and Peru improved opportunities related to housing conditions

     
    
  
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]  Reflection: Equality of Opportunities  
 


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Executive Summary
Reducing inequality is one of the main development challenges in Latin America. Inequality is pervasive, resilient, and judged to be fundamentally unfair by many. Despite this reality, the political and policy debates about if, how, and by how much inequality should be reduced are often polarizing. This executive summary briefly exposes the main findings of the study, which are analyzed with greater thoroughness in each one of the chapters. The executive summary explains the HOI, including the possible applications of the index to real policies. It also describes the proportion of the actual inequality in the income, consumption and education associated with the inequality of opportunities. 

Download the executive summary here »
 
   

Chapter 1: INEQUALITY OF OPPORTUNITY: WHAT IT IS, HOW IT CAN BE MEASURED, AND WHY IT MATTERS
Even though poverty and inequality are related concepts, the goals of reducing them have received different levels of support. Reducing poverty is a universally accepted aim and a priority for development work, and is included as the first Millennium Development Goal.
 
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Chapter 2: A HUMAN OPPORTUNITY INDEX FOR CHILDREN
This chapter seeks to measure inequality of opportunity by developing a Human Opportunity Index, a composite indicator that combines two elements: (i) the level of coverage of basic opportunities necessary for human development, such as primary education, water and sanitation, and electricity; and (ii) the degree to which the distribution of those opportunities is conditional on circumstances exogenous to children, such as gender, income, or household characteristics.
 
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Chapter 3: USES AND POLICY APPLICATIONS OF THE HUMAN OPPORTUNITY INDEX
This chapter presents some applications and analyses of the properties of the Human Opportunity Index with a view to obtaining a better understanding of inequality and highlighting some of the ways the resulting information can be applied to designing effective policy.
 
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Chapter 4: INEQUALITY OF ECONOMIC OPPORTUNITY IN SEVEN LATIN AMERICAN COUNTRIES
This chapter uses a “top-down” approach that decomposes total outcome inequality into two components, one resulting from circumstances beyond the control of the individual, and a residual component that captures rewards to effort as well as luck.
 
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Chapter 5: INEQUALITY OF OPPORTUNITY IN EDUCATIONAL ACHIEVEMENT IN FIVE LATIN AMERICAN COUNTRIES
This chapter presents estimates of inequality of opportunity for educational achievement in several Latin American countries, using a technique similar to that in the previous chapter. Inequality of opportunity in the acquisition of education is as important as inequality of opportunity in economic welfare, for several reasons.
 
Download chapter 5 here »



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