Equality of Opportunity, Moral Hazard and the Timing of Luck

Arbeitspapier

Equality of opportunity is usually defined as a situation where the effect of circumstances on outcome is nullified (compensation principle) and effort is rewarded (reward principle). We propose a new version of the reward principle based on the idea that effort deserves reward for it is costly. We show that luck can be introduced in two ways in the definition of these principles, depending on whether the correlation between luck and circumstances should be nullified and whether the correlation between luck and effort should be rewarded. In this regard, the timing of luck with respect to effort decisions is crucial, as is exemplified by moral hazard where effort choice influences the lottery of future uncertain events.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: IZA Discussion Papers ; No. 10645

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Equity, Justice, Inequality, and Other Normative Criteria and Measurement ; Job, Occupational, and Intergenerational Mobility; Promotion ; Semiparametric and Nonparametric Methods: General
• Thema: equality of opportunity ; effort ; luck ; timeline ; moral hazard ; reward

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Lefranc, Arnaud ; Trannoy, Alain
• Ereignis: Veröffentlichung
• (wer): Institute of Labor Economics (IZA)
• (wo): Bonn
• (wann): 2017

Weitere Informationen

• Handle: http://hdl.handle.net/10419/161268
• Letzte Aktualisierung: 10.03.2025, 11:44 MEZ