Do Poorer Countries Have Less Capacity for Redistribution?

Development aid and policy discussions often assume that poorer countries have less internal capacity for redistribution in favor of their poorest citizens. The assumption is tested using data for 90 developing countries. The capacity for redistrib...

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Bibliographic Details
Main Author: Ravallion, Martin
Format: Policy Research Working Paper
Language:English
Published: 2012
Subjects:
Online Access:http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090909133807
http://hdl.handle.net/10986/4238
id okr-10986-4238
recordtype oai_dc
repository_type Digital Repository
institution_category Foreign Institution
institution Digital Repositories
building World Bank Open Knowledge Repository
collection World Bank
language English
topic ABSOLUTE VALUE
ACCOUNTING
AGGREGATE INCOME
AGGREGATE POVERTY
AID DONORS
ALLEVIATION OF POVERTY
ANTI-POVERTY
ANTI-POVERTY PROGRAM
ANTI-POVERTY STRATEGY
AVERAGE INCOME
CASH TRANSFER
CASH TRANSFERS
CITIZENS
CITIZENSHIP
CONSUMER DEMAND
CONSUMPTION EXPENDITURE
CONSUMPTION PER CAPITA
COUNTRY LEVEL
COUNTRY PERFORMANCE
CREDIT CONSTRAINTS
CUMULATIVE DISTRIBUTION
CUMULATIVE DISTRIBUTION FUNCTION
DATA SET
DATA SETS
DEVELOPING COUNTRIES
DEVELOPING COUNTRY
DEVELOPING WORLD
DEVELOPMENT POLICY
DEVELOPMENT RESEARCH
DISTRIBUTIONAL EFFECTS
ECONOMIC DEVELOPMENT
ECONOMIC GROWTH
ECONOMIC INEQUALITY
ECONOMIC REVIEW
ECONOMICS
ECONOMICS LETTERS
EMPIRICAL ISSUE
EXTREME POVERTY
FIGHT AGAINST POVERTY
FOREIGN AID
FUNCTIONAL FORM
GINI INDEX
GLOBAL ECONOMY
GLOBAL POVERTY
GROSS INCOME
GROWTH EFFECT
GROWTH ELASTICITY
GROWTH RATES
HETEROSKEDASTICITY
HIGH INEQUALITY
HIGH INEQUALITY COUNTRIES
HIGHER INEQUALITY
HUMAN CAPITAL
INCOME DISTRIBUTION
INCOME GROUPS
INCOME INEQUALITY
INCOME LEVEL
INCOME REDISTRIBUTION
INCOME SHARE
INCOME TAX
INCOME TAXES
INEQUALITY MEASURE
INEQUALITY WILL
INTERNATIONAL BANK
LOG GINI
LOW INEQUALITY
MACROECONOMIC MANAGEMENT
MARGINAL TAX
MARGINAL TAX RATE
MARGINAL TAX RATES
MEAN CONSUMPTION
MEAN INCOME
MEAN INCOMES
MEASUREMENT ERRORS
MEASUREMENT OF POVERTY
MEDIAN POVERTY
MEDIAN VOTER
MEDIAN VOTER THEOREM
MIDDLE CLASS
MONETARY FUND
NATIONAL ACCOUNTS
NATIONAL POVERTY
NATIONAL POVERTY LINE
NATIONAL POVERTY LINES
NATIONAL SURVEYS
NEGATIVE CORRELATION
NEGATIVE GROWTH
POLICY DISCUSSIONS
POLICY ISSUES
POLICY REFORMS
POLICY RESEARCH
POLICY RESEARCH WORKING PAPER
POLICY REVIEW
POOR COUNTIES
POOR COUNTRIES
POOR COUNTRY
POOR REDISTRIBUTION
POSITIVE COEFFICIENT
POSITIVE GROWTH
POSITIVE RELATIONSHIP
POVERTY GAP
POVERTY GAP INDEX
POVERTY LINE
POVERTY LINES
POVERTY MEASURES
POVERTY POLICIES
POVERTY PROBLEM
POVERTY REDUCTION
PRIVATE CONSUMPTION
PRO-POOR
PROGRESS
PUBLIC CHOICE
PUBLIC SPENDING
PURCHASING POWER
PURCHASING POWER PARITY
QUALITY GROWTH
RATE OF GROWTH
REDISTRIBUTIVE POLICIES
REDISTRIBUTIVE POLICY
REDUCING INEQUALITY
REDUCING POVERTY
REDUCTION STRATEGY
RELATIVE DISTRIBUTION
RESPECT
RICH COUNTRIES
RICH PEOPLE
RICHER COUNTRIES
SAFETY NETS
SOCIAL POLICY
STANDARD DEVIATION
TAX SYSTEMS
UNEQUAL COUNTRIES
spellingShingle ABSOLUTE VALUE
ACCOUNTING
AGGREGATE INCOME
AGGREGATE POVERTY
AID DONORS
ALLEVIATION OF POVERTY
ANTI-POVERTY
ANTI-POVERTY PROGRAM
ANTI-POVERTY STRATEGY
AVERAGE INCOME
CASH TRANSFER
CASH TRANSFERS
CITIZENS
CITIZENSHIP
CONSUMER DEMAND
CONSUMPTION EXPENDITURE
CONSUMPTION PER CAPITA
COUNTRY LEVEL
COUNTRY PERFORMANCE
CREDIT CONSTRAINTS
CUMULATIVE DISTRIBUTION
CUMULATIVE DISTRIBUTION FUNCTION
DATA SET
DATA SETS
DEVELOPING COUNTRIES
DEVELOPING COUNTRY
DEVELOPING WORLD
DEVELOPMENT POLICY
DEVELOPMENT RESEARCH
DISTRIBUTIONAL EFFECTS
ECONOMIC DEVELOPMENT
ECONOMIC GROWTH
ECONOMIC INEQUALITY
ECONOMIC REVIEW
ECONOMICS
ECONOMICS LETTERS
EMPIRICAL ISSUE
EXTREME POVERTY
FIGHT AGAINST POVERTY
FOREIGN AID
FUNCTIONAL FORM
GINI INDEX
GLOBAL ECONOMY
GLOBAL POVERTY
GROSS INCOME
GROWTH EFFECT
GROWTH ELASTICITY
GROWTH RATES
HETEROSKEDASTICITY
HIGH INEQUALITY
HIGH INEQUALITY COUNTRIES
HIGHER INEQUALITY
HUMAN CAPITAL
INCOME DISTRIBUTION
INCOME GROUPS
INCOME INEQUALITY
INCOME LEVEL
INCOME REDISTRIBUTION
INCOME SHARE
INCOME TAX
INCOME TAXES
INEQUALITY MEASURE
INEQUALITY WILL
INTERNATIONAL BANK
LOG GINI
LOW INEQUALITY
MACROECONOMIC MANAGEMENT
MARGINAL TAX
MARGINAL TAX RATE
MARGINAL TAX RATES
MEAN CONSUMPTION
MEAN INCOME
MEAN INCOMES
MEASUREMENT ERRORS
MEASUREMENT OF POVERTY
MEDIAN POVERTY
MEDIAN VOTER
MEDIAN VOTER THEOREM
MIDDLE CLASS
MONETARY FUND
NATIONAL ACCOUNTS
NATIONAL POVERTY
NATIONAL POVERTY LINE
NATIONAL POVERTY LINES
NATIONAL SURVEYS
NEGATIVE CORRELATION
NEGATIVE GROWTH
POLICY DISCUSSIONS
POLICY ISSUES
POLICY REFORMS
POLICY RESEARCH
POLICY RESEARCH WORKING PAPER
POLICY REVIEW
POOR COUNTIES
POOR COUNTRIES
POOR COUNTRY
POOR REDISTRIBUTION
POSITIVE COEFFICIENT
POSITIVE GROWTH
POSITIVE RELATIONSHIP
POVERTY GAP
POVERTY GAP INDEX
POVERTY LINE
POVERTY LINES
POVERTY MEASURES
POVERTY POLICIES
POVERTY PROBLEM
POVERTY REDUCTION
PRIVATE CONSUMPTION
PRO-POOR
PROGRESS
PUBLIC CHOICE
PUBLIC SPENDING
PURCHASING POWER
PURCHASING POWER PARITY
QUALITY GROWTH
RATE OF GROWTH
REDISTRIBUTIVE POLICIES
REDISTRIBUTIVE POLICY
REDUCING INEQUALITY
REDUCING POVERTY
REDUCTION STRATEGY
RELATIVE DISTRIBUTION
RESPECT
RICH COUNTRIES
RICH PEOPLE
RICHER COUNTRIES
SAFETY NETS
SOCIAL POLICY
STANDARD DEVIATION
TAX SYSTEMS
UNEQUAL COUNTRIES
Ravallion, Martin
Do Poorer Countries Have Less Capacity for Redistribution?
geographic_facet The World Region
The World Region
relation Policy Research working paper ; no. WPS 5046
description Development aid and policy discussions often assume that poorer countries have less internal capacity for redistribution in favor of their poorest citizens. The assumption is tested using data for 90 developing countries. The capacity for redistribution is measured by the marginal tax rate on those who are not poor by rich-country standards that is needed to cover the poverty gap or to provide a poverty-level of basic income, judged by developing-country standards. For most (but not all) countries with annual consumption per capita under $2,000 (at 2005 purchasing power parity) the required tax burdens are found to be prohibitive-often calling for marginal tax rates of 100 percent or more. By contrast, the required tax rates are quite low (1 percent on average) among all countries with consumption per capita over $4,000, as well as some poorer countries. Most countries fall into one of two groups: those with little or no realistic prospect of addressing extreme poverty through redistribution from the "rich" and those that would appear to have ample scope for such redistribution. Economic growth tends to move countries from the first group to the second. Thus the appropriate balance between growth and redistribution strategies can be seen to depend on the level economic development.
format Publications & Research :: Policy Research Working Paper
author Ravallion, Martin
author_facet Ravallion, Martin
author_sort Ravallion, Martin
title Do Poorer Countries Have Less Capacity for Redistribution?
title_short Do Poorer Countries Have Less Capacity for Redistribution?
title_full Do Poorer Countries Have Less Capacity for Redistribution?
title_fullStr Do Poorer Countries Have Less Capacity for Redistribution?
title_full_unstemmed Do Poorer Countries Have Less Capacity for Redistribution?
title_sort do poorer countries have less capacity for redistribution?
publishDate 2012
url http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090909133807
http://hdl.handle.net/10986/4238
_version_ 1764390544457334784
spelling okr-10986-42382021-04-23T14:02:16Z Do Poorer Countries Have Less Capacity for Redistribution? Ravallion, Martin ABSOLUTE VALUE ACCOUNTING AGGREGATE INCOME AGGREGATE POVERTY AID DONORS ALLEVIATION OF POVERTY ANTI-POVERTY ANTI-POVERTY PROGRAM ANTI-POVERTY STRATEGY AVERAGE INCOME CASH TRANSFER CASH TRANSFERS CITIZENS CITIZENSHIP CONSUMER DEMAND CONSUMPTION EXPENDITURE CONSUMPTION PER CAPITA COUNTRY LEVEL COUNTRY PERFORMANCE CREDIT CONSTRAINTS CUMULATIVE DISTRIBUTION CUMULATIVE DISTRIBUTION FUNCTION DATA SET DATA SETS DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPING WORLD DEVELOPMENT POLICY DEVELOPMENT RESEARCH DISTRIBUTIONAL EFFECTS ECONOMIC DEVELOPMENT ECONOMIC GROWTH ECONOMIC INEQUALITY ECONOMIC REVIEW ECONOMICS ECONOMICS LETTERS EMPIRICAL ISSUE EXTREME POVERTY FIGHT AGAINST POVERTY FOREIGN AID FUNCTIONAL FORM GINI INDEX GLOBAL ECONOMY GLOBAL POVERTY GROSS INCOME GROWTH EFFECT GROWTH ELASTICITY GROWTH RATES HETEROSKEDASTICITY HIGH INEQUALITY HIGH INEQUALITY COUNTRIES HIGHER INEQUALITY HUMAN CAPITAL INCOME DISTRIBUTION INCOME GROUPS INCOME INEQUALITY INCOME LEVEL INCOME REDISTRIBUTION INCOME SHARE INCOME TAX INCOME TAXES INEQUALITY MEASURE INEQUALITY WILL INTERNATIONAL BANK LOG GINI LOW INEQUALITY MACROECONOMIC MANAGEMENT MARGINAL TAX MARGINAL TAX RATE MARGINAL TAX RATES MEAN CONSUMPTION MEAN INCOME MEAN INCOMES MEASUREMENT ERRORS MEASUREMENT OF POVERTY MEDIAN POVERTY MEDIAN VOTER MEDIAN VOTER THEOREM MIDDLE CLASS MONETARY FUND NATIONAL ACCOUNTS NATIONAL POVERTY NATIONAL POVERTY LINE NATIONAL POVERTY LINES NATIONAL SURVEYS NEGATIVE CORRELATION NEGATIVE GROWTH POLICY DISCUSSIONS POLICY ISSUES POLICY REFORMS POLICY RESEARCH POLICY RESEARCH WORKING PAPER POLICY REVIEW POOR COUNTIES POOR COUNTRIES POOR COUNTRY POOR REDISTRIBUTION POSITIVE COEFFICIENT POSITIVE GROWTH POSITIVE RELATIONSHIP POVERTY GAP POVERTY GAP INDEX POVERTY LINE POVERTY LINES POVERTY MEASURES POVERTY POLICIES POVERTY PROBLEM POVERTY REDUCTION PRIVATE CONSUMPTION PRO-POOR PROGRESS PUBLIC CHOICE PUBLIC SPENDING PURCHASING POWER PURCHASING POWER PARITY QUALITY GROWTH RATE OF GROWTH REDISTRIBUTIVE POLICIES REDISTRIBUTIVE POLICY REDUCING INEQUALITY REDUCING POVERTY REDUCTION STRATEGY RELATIVE DISTRIBUTION RESPECT RICH COUNTRIES RICH PEOPLE RICHER COUNTRIES SAFETY NETS SOCIAL POLICY STANDARD DEVIATION TAX SYSTEMS UNEQUAL COUNTRIES Development aid and policy discussions often assume that poorer countries have less internal capacity for redistribution in favor of their poorest citizens. The assumption is tested using data for 90 developing countries. The capacity for redistribution is measured by the marginal tax rate on those who are not poor by rich-country standards that is needed to cover the poverty gap or to provide a poverty-level of basic income, judged by developing-country standards. For most (but not all) countries with annual consumption per capita under $2,000 (at 2005 purchasing power parity) the required tax burdens are found to be prohibitive-often calling for marginal tax rates of 100 percent or more. By contrast, the required tax rates are quite low (1 percent on average) among all countries with consumption per capita over $4,000, as well as some poorer countries. Most countries fall into one of two groups: those with little or no realistic prospect of addressing extreme poverty through redistribution from the "rich" and those that would appear to have ample scope for such redistribution. Economic growth tends to move countries from the first group to the second. Thus the appropriate balance between growth and redistribution strategies can be seen to depend on the level economic development. 2012-03-19T19:12:24Z 2012-03-19T19:12:24Z 2009-09-01 http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090909133807 http://hdl.handle.net/10986/4238 English Policy Research working paper ; no. WPS 5046 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Publications & Research :: Policy Research Working Paper The World Region The World Region