Household Incomes and Redistribution in the European Union: Quantifying the Equalising Properties of Taxes and Benefits

By H. Immervoll, Horacio Levy, Christine Lietz, D. Mantovani, Cathal O’Donoghue, Holly Sutherland, G. Verbist. Social Science Research Network, 2005

124 citations recorded by the source corpus.

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.

Subfields: Gender Studies, Political Science and International Relations, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/b6ad61b1942aa7c77b5fc25a2081d595f4d9ed9c

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Gender Studies

1. Linda Richardson
2. F. Figari
3. Holly Sutherland
4. H. Immervoll
5. M. Ravallion

In Political Science and International Relations

1. F. Figari
2. Linda Richardson
3. Holly Sutherland
4. Alari Paulus
5. H. Immervoll

In Sociology and Political Science

1. F. Figari
2. Alari Paulus
3. Holly Sutherland
4. H. Immervoll
5. Linda Richardson
6. M. Ravallion
7. M. Hermansen
8. O. Causa

Citations in the corpus

• The Redistributive Effects of Tax Benefit Systems in the Enlarged EU (2010, unknown): “Due to this sensitivity of the redistributive measures with regard to the definition of pre-instrument income, Immervoll et al. (2005) follow a slightly different approach that we also apply as a robustness check of our results.”
• Redistribution Policy and Inequality Reduction in OECD Countries: What Has Changed in Two Decades? (2011, background): “Multi-country comparative studies that consider the entire taxbenefit system are rare, and mostly limited to a particular point in time (Immervoll et al., 2006, AttaDarkua and Barnard, 2006).”
• EUROMOD: the European Union tax-benefit microsimulation model (2012, background): “Immervoll et al. (2006) is one of the first and most cited empirical analysis on the redistributive effects of taxes and benefits in European countries.”
• Microsimulation and policy analysis (2014, methodology): “This ha been studied for example by Immervoll (2005), Immervoll et al. (2006) and Sutherland et al. (2008).”