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http://hdl.handle.net/10419/33646
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| Title: | | Household incomes and redistribution in the European Union: quantifying the equalising properties of taxes and benefits  |
| Authors: | | Immervoll, Herwig |
| Issue Date: | | 2005 |
| Series/Report no.: | | IZA Discussion Papers 1824 |
| Abstract: | | The systems of direct taxes and cash benefits in the Member States of the European Union vary considerably in size and structure. We explore their direct impacts on cross-sectional income inequality (termed redistributive effect for the purpose of this paper) using EUROMOD, a tax-benefit microsimulation model for the European Union. This relies on harmonised household micro-data representative of each national population together with simulations of entitlements to cash benefits and liabilities for taxes and social contributions. It allows us to draw a more comprehensive and comparable picture of the combined effects of transfers and taxes than is usually possible. We decompose the redistributive effect of tax-benefit systems to assess and compare the effectiveness of individual policies at reducing income disparities. The following categories of benefits and taxes are considered both individually and in combination: income taxes, social contributions, cash benefits designed to target the poor or redistribute inter-personally (through means-testing) as well as cash benefits intended to redistribute intra-personally across the lifecycle (through social insurance or contingency-based entitlement). We derive results for the 15 old members of the European Union and present them for each country separately as well as for the EU-15 as a whole. |
| Subjects: | | income inequality redistribution microsimulation European Union |
| JEL: | | C81 D31 H22 H55 |
| Document Type: | | Working Paper |
| Appears in Collections: | | IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)
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