The Impact of Fiscal Policy on Inequality and Poverty in Chile
This paper applies a comprehensive tax-benefit incidence analysis to estimate the distributional effects of fiscal policy in Chile in 2013. Four results are indicative of an overall positive net effect of fiscal interventions on poverty and inequal...
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World Bank, Washington, DC
2017
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| Online Access: | http://documents.worldbank.org/curated/en/924981484072376329/The-impact-of-fiscal-policy-on-inequality-and-poverty-in-Chile http://hdl.handle.net/10986/25948 |
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okr-10986-259482021-06-08T14:42:47Z The Impact of Fiscal Policy on Inequality and Poverty in Chile Martinez-Aguilar, Sandra Fuchs, Alan Ortiz-Juarez, Eduardo Del Carmen, Giselle fiscal policy inequality poverty social assistance taxation poverty line tertiary education pro-poor This paper applies a comprehensive tax-benefit incidence analysis to estimate the distributional effects of fiscal policy in Chile in 2013. Four results are indicative of an overall positive net effect of fiscal interventions on poverty and inequality. First, subsidies exert a positive, yet modest effect on poverty and inequality, whereas direct transfers are progressive, equalizing, and reduce the poverty headcount by 4 to 5 percentage points, depending on the poverty line used. Second, although social contributions are unequalizing and poverty-increasing, direct taxes on personal income are equalizing and poverty-neutral, whereas indirect taxes are poverty-increasing but exert a counterintuitive, yet feasible equalizing effect known as Lambert's conundrum. Third, social spending on tertiary education is slightly equalizing but it is not pro-poor, contrary to the effects of social spending on basic and secondary education and health, which are not only equalizing but also pro-poor. Finally, the net effect of Chile's tax/transfer system leaves fewer individuals impoverished relative to the number of fiscal gainers, and the magnitude of monetary fiscal gains is significantly higher than that of fiscal impoverishment. 2017-01-30T17:48:44Z 2017-01-30T17:48:44Z 2017-01 Working Paper http://documents.worldbank.org/curated/en/924981484072376329/The-impact-of-fiscal-policy-on-inequality-and-poverty-in-Chile http://hdl.handle.net/10986/25948 English en_US Policy Research working paper,no. WPS 7939; Policy Research Working Paper;No. 7939 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper Latin America & Caribbean Chile |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
fiscal policy inequality poverty social assistance taxation poverty line tertiary education pro-poor |
| spellingShingle |
fiscal policy inequality poverty social assistance taxation poverty line tertiary education pro-poor Martinez-Aguilar, Sandra Fuchs, Alan Ortiz-Juarez, Eduardo Del Carmen, Giselle The Impact of Fiscal Policy on Inequality and Poverty in Chile |
| geographic_facet |
Latin America & Caribbean Chile |
| relation |
Policy Research working paper,no. WPS 7939; |
| description |
This paper applies a comprehensive
tax-benefit incidence analysis to estimate the
distributional effects of fiscal policy in Chile in 2013.
Four results are indicative of an overall positive net
effect of fiscal interventions on poverty and inequality.
First, subsidies exert a positive, yet modest effect on
poverty and inequality, whereas direct transfers are
progressive, equalizing, and reduce the poverty headcount by
4 to 5 percentage points, depending on the poverty line
used. Second, although social contributions are unequalizing
and poverty-increasing, direct taxes on personal income are
equalizing and poverty-neutral, whereas indirect taxes are
poverty-increasing but exert a counterintuitive, yet
feasible equalizing effect known as Lambert's
conundrum. Third, social spending on tertiary education is
slightly equalizing but it is not pro-poor, contrary to the
effects of social spending on basic and secondary education
and health, which are not only equalizing but also pro-poor.
Finally, the net effect of Chile's tax/transfer system
leaves fewer individuals impoverished relative to the number
of fiscal gainers, and the magnitude of monetary fiscal
gains is significantly higher than that of fiscal impoverishment. |
| format |
Working Paper |
| author |
Martinez-Aguilar, Sandra Fuchs, Alan Ortiz-Juarez, Eduardo Del Carmen, Giselle |
| author_facet |
Martinez-Aguilar, Sandra Fuchs, Alan Ortiz-Juarez, Eduardo Del Carmen, Giselle |
| author_sort |
Martinez-Aguilar, Sandra |
| title |
The Impact of Fiscal Policy on Inequality and Poverty in Chile |
| title_short |
The Impact of Fiscal Policy on Inequality and Poverty in Chile |
| title_full |
The Impact of Fiscal Policy on Inequality and Poverty in Chile |
| title_fullStr |
The Impact of Fiscal Policy on Inequality and Poverty in Chile |
| title_full_unstemmed |
The Impact of Fiscal Policy on Inequality and Poverty in Chile |
| title_sort |
impact of fiscal policy on inequality and poverty in chile |
| publisher |
World Bank, Washington, DC |
| publishDate |
2017 |
| url |
http://documents.worldbank.org/curated/en/924981484072376329/The-impact-of-fiscal-policy-on-inequality-and-poverty-in-Chile http://hdl.handle.net/10986/25948 |
| _version_ |
1764460560063135744 |