Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/113333
Authors: 
De Agostini, Paola
Paulus, Alari
Sutherland, Holly
Tasseva, Iva
Year of Publication: 
2014
Series/Report no.: 
EUROMOD Working Paper EM9/14
Abstract: 
We compare the distributional effects of policy changes introduced in the period 2008-2013 in twelve EU countries using the EU microsimulation model EUROMOD. The countries, Germany, Estonia, Ireland, Greece, Spain, France, Italy, Latvia, Lithuania, Portugal, Romania and the UK, chose different policy mixes to achieve varying degrees of fiscal consolidation or expansion. We find that comparisons of the size and distributional effects of policy changes over time are sensitive to the counterfactual assumption that is adopted in adjusting 2008 policies for changes in prices and incomes over the period. Nevertheless, it is clear that the direct tax, public pension and cash benefit changes had broadly progressive effects across the pre-policy change income distributions, except in Germany, Estonia and Lithuania. Including increases in VAT alters the comparative picture by making the policy packages appear more regressive, to varying extents. The paper also explores the implications of the policy changes for measures of risk of poverty and examines the incidence of the changes by age.
Subjects: 
Tax-benefit policy reform
European Union
Income distribution
Microsimulation
JEL: 
C81
H55
I3
Document Type: 
Working Paper

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