The Law and Economics of Redistribution

Posted: 23 Oct 2019

See all articles by Matthew Dimick

Matthew Dimick

University at Buffalo School of Law

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Date Written: October 2019

Abstract

Should legal rules be used to redistribute income? Or should income taxation be the exclusive means for reducing income inequality? This article reviews the legal scholarship on this question. First, it traces how the most widely cited argument in favor of using taxes exclusively—Kaplow & Shavell's (1994) double-distortion argument—evolved from previous debates about whether legal rules could even be redistributive and whether law and economics should be concerned exclusively with efficiency or with distribution as well. Next, it surveys the responses to the double-distortion argument. These responses appear to have had only limited success in challenging the sturdy reputation of the double-distortion argument. Finally, it highlights new directions in a debate revived by increasing economic inequality.

Suggested Citation

Dimick, Matthew, The Law and Economics of Redistribution (October 2019). Annual Review of Law and Social Science, Vol. 15, pp. 559-582, 2019. Available at SSRN: https://ssrn.com/abstract=3472523 or http://dx.doi.org/10.1146/annurev-lawsocsci-101518-043037

Matthew Dimick (Contact Author)

University at Buffalo School of Law ( email )

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