Transition Report 2013 Stuck in transition?

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Facts at a glance

OVER 35% of variation in wealth in some transition countries is explained by circumstances at birth.

GENDER GAPS are greatest in the areas of employment, firm ownership and management across most countries observed.

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PLACE OF BIRTH is the main driver of inequality with regard to wealth.

PARENTAL EDUCATION is the main driver of inequality of opportunity with regard to tertiary education.

RIGID LABOUR MARKET STRUCTURES and weak education systems restrict opportunities for young people.

Economic inclusion

Inequality of opportunity with regard to tertiary education

Chart 5.8 shows inequality of opportunity across countries with regard to tertiary education and breaks it down into the contributions of individual circumstances. Unlike Chart 5.6, gender is included as a circumstance, and the measure of inequality is different.

Reflecting the binary outcome variable, a “dissimilarity index” (D-index) is used. This is calculated as the average distance (the average absolute value of the difference) between the country mean and the circumstance-based prediction of whether an individual is likely to obtain a tertiary education, multiplied by 2 in order to fit it to the 0-1 scale. For example, a 10 per cent D-index indicates that, on average, the predicted propensity of individuals to obtain a tertiary education is just 5 per cent away from the average in that country.

Chart 5.8
Western Europe CEB SEE EEC Central Asia

Source: LiTS (2010).
Note: The chart indicates, for each country, the average distance between tertiary education as predicted by circumstances (the place of birth, parental education, parental membership of the communist party and gender) and the mean. For each country, each bar is calculated as a D-index, based on a probit regression of the variable indicating the completion of tertiary education on the four variables indicated in the chart's legend (see Annex 5.1).

IOpedu turns out to be fairly similar across regions. The EEC region and France have the highest IOpedu (but it exceeds 25 per cent in only three transition countries – Georgia, Russia and Ukraine).

The chart also shows that – unlike IOpwealth – IOpedu appears to be driven far more by parental education than by the place of birth. In addition, gender seems to play a role in Azerbaijan, Germany, the Slovak Republic and Turkey (reflecting a significantly greater likelihood that men will obtain tertiary degrees, except in the Slovak Republic). In Azerbaijan, Belarus, Georgia, Mongolia, Russia and Ukraine – and, to a lesser extent, Bulgaria – parental membership of the communist party is a significant contributor (both statistically and in a qualitative sense).

Separate analysis was also undertaken for younger (37 and under) and older (38 and over) sections of the population. The cohorts were defined in that way so that the older group would have reached adulthood by the time the Soviet Union was dissolved in 1991. The question is whether inequality of opportunity with regard to tertiary education is lower in the group that was raised under the (generally) more egalitarian communist system than in the younger generation. The analysis finds some support for this: in 21 of the 29 transition countries, IOpedu is higher in the younger group. However, the differences are generally small and are statistically significant in only eight cases.