Measuring the contribution of racial stratification and social class at birth to inequality of opportunity

This paper develops a framework for decomposing inequality of opportunity into racial stratification and
social class components. We derive novel dominance conditions that enable robust rankings of joint
distributions of income and birth circumstances, and develop additional dominance criteria for restricted
classes of indices reflecting either pro-poor or meritocratic perspectives. Our framework includes an
estimation approach and statistical tests for these stochastic dominance conditions, ensuring practical
application with survey data. Using Health and Retirement Study data, we analyze inequality of opportunity
in earnings among aging U.S. populations between 2010-2020. While social class-based inequality
decreased for certain classes of indices, the racial stratification component increased, driving overall rising
inequality of opportunity