Measuring Distributional Effects of Fiscal Reforms

Finanzwissenschaftliche Diskussionsbeiträge Paper No. 06-9

70 Pages Posted: 20 Sep 2006

See all articles by Andreas Peichl

Andreas Peichl

ZEW – Leibniz Centre for European Economic Research; University of Mannheim - School of Economics (VWL); IZA Institute of Labor Economics; University of Essex - Institute for Social and Economic Research (ISER)

Richard R. Ochmann

German Institute for Economic Research (DIW Berlin)

Date Written: September 2006

Abstract

The purpose of this paper is to provide an overview of how to analyse the distributional effects of fiscal reforms. Thereby, distributional effects shall be differentiated by four subconcepts, i.e. 1.) the traditional concept of inequality, 2.) the rather novel concept of polarisation, 3.) the concept of progression in taxation, and 4.) the concepts of income poverty and richness.

The concept of inequality and the concept of income poverty are the by far most widely applied concepts in empirical analyses, probably since they appear to be the most transparent ones in their structure as well as the most controversial ones in political affairs. However, the concepts of richness, polarisation and progression in taxation shall additionally be subject of this analysis, since they appear to be useful devices on the course of analysing cause and effect of the other two concepts.

Keywords: Inequality, polarisation, progression, poverty, richness

JEL Classification: D3, H2, J22

Suggested Citation

Peichl, Andreas and Ochmann, Richard R., Measuring Distributional Effects of Fiscal Reforms (September 2006). Finanzwissenschaftliche Diskussionsbeiträge Paper No. 06-9, Available at SSRN: https://ssrn.com/abstract=931128 or http://dx.doi.org/10.2139/ssrn.931128

Andreas Peichl (Contact Author)

ZEW – Leibniz Centre for European Economic Research ( email )

P.O. Box 10 34 43
L 7,1
D-68034 Mannheim, 68034
Germany

University of Mannheim - School of Economics (VWL) ( email )

Mannheim 68131
Germany

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

University of Essex - Institute for Social and Economic Research (ISER)

Wivenhoe Park
Colchester CO4 3SQ
United Kingdom

Richard R. Ochmann

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstraße 58
Berlin, 10117
Germany

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