Fiscal Policy, Income Redistribution, and Poverty Reduction: Evidence from Tunisia

24 Pages Posted: 7 Aug 2019

See all articles by Nizar Jouini

Nizar Jouini

Doha Institute for Graduate Studies

Nora Lustig

Tulane University

Ahmed Moummi

United Nations - Department of Economic and Social Affairs (DESA)

Abebe Shimeles

Göteborg University

Date Written: October 2018

Abstract

This paper estimates the impact of Tunisia's tax and transfer system on inequality and poverty and assesses the benefits from public spending on education and health. Results show that Tunisia's redistributive fiscal policy reduces inequality and extreme poverty significantly. However, based on the national poverty line, the headcount ratio increases, implying that a large number of the poor people pay more in taxes than they receive in cash transfers and subsidies. This is due to a relatively high burden of personal income taxes and social security contributions for low‐income households.

Keywords: benefit incidence, inequality, poverty, social spending, Tunisia

JEL Classification: D31, H22, I38

Suggested Citation

Jouini, Nizar and Lustig, Nora Claudia and Moummi, Ahmed and Shimeles, Abebe, Fiscal Policy, Income Redistribution, and Poverty Reduction: Evidence from Tunisia (October 2018). Review of Income and Wealth, Vol. 64, pp. S225-S248, 2018. Available at SSRN: https://ssrn.com/abstract=3273051 or http://dx.doi.org/10.1111/roiw.12372

Nizar Jouini (Contact Author)

Doha Institute for Graduate Studies

Al Tarfa Street
Doha, Zone 70
Qatar

Nora Claudia Lustig

Tulane University ( email )

6823 St Charles Ave
New Orleans, LA 70118
United States

Ahmed Moummi

United Nations - Department of Economic and Social Affairs (DESA)

New York, NY 10017
United States

Abebe Shimeles

Göteborg University ( email )

Viktoriagatan 30
Göteborg, 405 30
Sweden

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