Inclusive Growth and the Incidence of Fiscal Policy in Mauritius — Much Progress, But More Could Be Done
29 Pages Posted: 18 Jun 2013
Date Written: May 2013
Using data from three household surveys, we review whether growth in Mauritius was inclusive and discuss the incidence of public expenditures and taxes. Generally, Mauritius enjoys an even income distribution and low rates of poverty. Nevertheless, over the 2000s, despite overall progress, the benefits of growth appear to have become more skewed. Employment income is the main contributor to inequality in Mauritius. Social protection expenditures reduce poverty and inequality, but could be better targeted, particularly for pensions. Income taxes are progressive, though given their small relative weight they have a negligible impact on income distribution. The VAT appears relatively progressive compared to other developing countries, although its impact on the overall distribution is also small. With better targeting of the sizable social spending, significant further progress in poverty alleviation could be achieved.
Keywords: Economic growth, Mauritius, Fiscal policy, Government expenditures, Tax revenues, Tax structures, Income distribution, Income taxes, Inclusive Growth, Incidence of Public Expenditures, Incidence of Taxes, expenditures, expenditure, public expenditures, consumption expenditure, capital expenditures, total expenditures, social protection expenditures, public expenditure, gini, redistributive impact, consumption growth, expenditure per capita, gini coefficient, expenditures on health, education expenditures, household consumption expenditure, expenditure policy, labor market, government expenditure, public expenditures on education, wealth distribution, expenditure incidence, primary education
JEL Classification: D31, H22, H50
Suggested Citation: Suggested Citation