Measuring redistributive effects of taxes and benefits: beyond the proportionality standard

Publication type

Journal Article

Author

Publication date

June 1, 2019

Summary:

Standard models for measuring the redistributive effects of fiscal systems, such as the Kakwani-Lambert model, are almost exclusively based on the relative income inequality concept. This concept implies that the inequality-neutral tax and benefit are proportional to the prefiscal income. However, given the variety of alternative inequality concepts, it seems justified to propose alternative forms of inequality-neutral taxes and benefits. This paper generalizes the Kakwani-Lambert model within the ˛-inequality concept of Bosmans et al. (2014), which enables the appraisal of redistributive effects for a range of different inequality views. The new model is applied to estimate the vertical effects of personal income taxes and cash social benefits in Croatia, Slovenia, Slovakia, and Austria in 2017.

Published in

FinanzArchiv

DOI

https://doi.org/10.1628/fa-2019-0008

ISSN

16140974

Subjects

Notes

Online Early

#525834

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