Inequality of Opportunity in the Labour Market Entry of Graduates in Italy

Abstract

The aim of the study is to test for equality of opportunity at the en- try into the national labour market of Italian graduates. By using an Italian survey data on the transition from university to work, we focus on the probability to get a job within three years from the graduation, and we find significant differences across individuals with different family background. In an attempt to explain whether these differences refiect op- portunity inequality, we adopt the Gomulka-Stern decomposition method. This method allows us to decompose differences in the probability to find a job between groups of people with different family background into two additive components. The first component can be attributed to differ- ences between groups in the distribution of individualsfi characteristics. The second component is a residual difference which can be attributed to opportunity inequality under the assumption that there is no unobserved heterogeneity between groups. In the presence of unobserved heterogene- ity, this residual component gives us a biased estimation for the difference in probability explained by opportunity inequality.Inequality of Opportunity, Higher Education, Gomulka-Stern Decomposition.