Inequality of Human Opportunities in Developing Asia

This paper analyzes the equity of opportunity in basic education and infrastructure services in seven developing countries, Bangladesh, Bhutan, Indonesia, Pakistan, the Philippines, Sri Lanka, and Viet Nam. The analysis applies a method developed by the World Bank called the Human Opportunity Index, which measures the total contribution of individual socioeconomic and demographic circumstances to inequality of opportunity in accessing basic services. The new and major contribution of the paper, however, is the development of a methodology that quantifies the relative contribution of each circumstance variable to the inequality of opportunity. This contribution is crucial in identifying which underlying inequalities matter most—which can have important policy implications, for instance, in terms of developing better-targeted interventions. Results of the empirical analysis indicate that more needs to be done to improve the distribution of economic benefits. Opportunities to access basic education and infrastructure services in the seven countries vary widely in terms of availability and distribution. The study also finds that inequality of opportunity is driven mainly by per capita household expenditure. This suggests that household poverty plays a crucial role in determining equitable access to basic services.