EconStor >
Stockholm School of Economics >
EFI - The Economic Research Institute, Stockholm School of Economics >
SSE/EFI Working Paper Series in Economics and Finance, EFI - The Economic Research Institute, Stockholm School of Economics >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/56183
  
Title:Interregional inequality and Robin Hood politics PDF Logo
Authors:Bergman, Malin L.
Issue Date:2003
Series/Report no.:SSE/EFI Working Paper Series in Economics and Finance 523
Abstract:This paper studies the implications of interregional redistributive taxation on interregional and interpersonal inequality and on social welfare. We introduce a model of two regions, where individuals are differentiated by their ability and opportunity, the former being determined by heritage and the latter by their residence. Moreover, agents are immobile and respond to interregional transfers by adjusting their labour supply, rather than by re-locating. The analysis shows, firstly, that increases in the rate of interregional redistribution need not generate neither reduced interregional inequality nor higher social welfare, and secondly, that their effects are highly dependent on the initial state of the economy. In particular, interregional redistribution seems most likely to be beneficial in terms of interregional and interpersonal equity as well as social welfare in low-tax economies, where the degree of income dispersion is high between, but not within regions.
Subjects:interregional redistribution
welfare
inequality
JEL:H31
H73
Document Type:Working Paper
Appears in Collections:SSE/EFI Working Paper Series in Economics and Finance, EFI - The Economic Research Institute, Stockholm School of Economics

Files in This Item:
File Description SizeFormat
363156062.pdf1.79 MBAdobe PDF
No. of Downloads: Counter Stats
Download bibliographical data as: BibTeX
Share on:http://hdl.handle.net/10419/56183

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.