Vertical and Horizontal Redistribution: The Cases of Western and Eastern Europe

Abstract

The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.

Redistribution and progressivity of the Italian personal income tax, 40 years later

“…This decomposition is similar to that proposed by Bussolo et al. (2019), in turn derived from Bourguignon, Ferreira and Leite (2008). We apply it to a wider time interval than Bussolo et al.…”

“…We apply it to a wider time interval than Bussolo et al. (2019), and provide a further split of one of its components, as described below. The main departure from the decomposition proposed by Bargain et al.…”

“…For Europe, a recent paper by Bussolo et al. (2019) using EUROMOD, a tax–benefit microsimulation model covering 28 countries, decomposes for each of them the changes in the Reynolds–Smolensky index of income taxes and transfers between 2007 and 2014. In Italy, the total variation is positive, indicating more redistribution, and the greater contribution comes from market changes.…”

Los retos de la fiscalidad ante el envejecimiento: evidencia comparada de la UE, EE UU y Japón

“…Estos estudios revelan un patrón común: el envejecimiento no solo altera la recaudación total de impuestos, sino que también afecta considerablemente a los ingresos del impuesto de la renta y del consumo. Además, el envejecimiento poblacional también afectaría a la capacidad redistributiva del sistema impositivo (Bussolo et al, 2019). Por ejemplo, Dang et al (2006) han calculado la carga impositiva por grupos de edad para los países de la OCDE, mediante el uso de microdatos, encontrando que los hogares de mayor edad, incluso con rentas altas, están sometidos a una carga impositiva directa relativamente más reducida en la mayoría de países analizados.…”

Features of personal income inequality before and during the crisis: an analysis of Italian regions

“…Southern regions saw a large increase in the relative cost of credit. Due to austerity, the national government reduced transfers to local governments, which had to downsize public services provision; regional trade and transfers diminished (apart from automatic stabilizers, see Bussolo, Krolage, Makovec, Peichl, Stoeckli & Torre, 2018), unemployment increased, mass job losses occurred and weak labour demand depressed real wages. These mechanisms increased within-region income inequality.…”