Assessing the Redistributive Effect of Fiscal Policy

Who benefits from public spending? Who bears the burden of taxation? How desirable is the distribution of net benefits from the operation of a tax-benefit system? This paper surveys basic concepts, methods, and modeling approaches commonly used t...

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Bibliographic Details
Main Author: Essama-Nssah, B.
Format: Policy Research Working Paper
Language:English
Published: World Bank, Washington, DC 2012
Subjects:
GDP
MBI
TAX
Online Access:http://documents.worldbank.org/curated/en/2008/04/9357308/assessing-redistributive-effect-fiscal-policy
http://hdl.handle.net/10986/6725
id okr-10986-6725
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 ACCOUNTING
ACCURATE ESTIMATE
ADDITIONAL INCOME
ADMINISTRATIVE COST
ADMINISTRATIVE COSTS
AFTER TAX INCOME
AMOUNT OF INCOME
AMOUNT OF MONEY
ANALYTICAL METHODS
APARTHEID
BASE YEAR
BENCHMARK
BENEFICIARIES
BUSINESS TAX
BUSINESS TAXES
CALCULATIONS
CAPITAL EXPENDITURE
CAPITAL OWNERS
CASH TRANSFERS
CLAIMANTS
COMMODITIES
COMMODITY
COMMODITY PRICES
COMPARATIVE ADVANTAGE
COMPARATIVE ANALYSIS
COMPETITIVE MARKET
CONSUMER
CONSUMERS
CONSUMPTION EXPENDITURE
CONSUMPTION TAXES
CORPORATE INCOME TAX
CORPORATE INCOME TAXES
COST OF FUNDS
COST RECOVERY
CREDITS
CURRENT EXPENDITURE
DECISION MAKING
DEDUCTIONS
DEMOGRAPHIC
DERIVATIVE
DEVELOPING COUNTRIES
DIRECT COSTS
DISPOSABLE INCOME
DISTRIBUTION OF INCOME
DUMMY VARIABLE
EARNINGS
ECONOMETRIC ANALYSIS
ECONOMIC COSTS
ECONOMIC MANAGEMENT
ECONOMIC TRANSACTIONS
ELASTICITY
ELASTICITY OF DEMAND
ELASTICITY OF SUPPLY
EQUILIBRIUM
EQUILIBRIUM PRICES
EQUITY ISSUES
ETHNIC GROUPS
EXCISE TAXES
FACTORS OF PRODUCTION
FISCAL POLICY
FLAT TAX
GDP
GINI COEFFICIENT
GOVERNMENT ACTIONS
GOVERNMENT BUDGET
GOVERNMENT INTERVENTION
GOVERNMENT POLICY
GOVERNMENT SUBSIDY
HEALTH SPENDING
HORIZONTAL EQUITY
HOUSEHOLD EXPENDITURE
HOUSEHOLD INCOME
HOUSEHOLD SPENDING
HUMAN CAPITAL
IMMUNIZATION
INCENTIVE EFFECTS
INCOME EFFECT
INCOME GROUP
INCOME GROUPS
INCOME INCREASE
INCOME INCREASES
INCOME LEVEL
INCOME LEVELS
INCOME SOURCES
INCOMES
INCOMPLETE MARKETS
INFORMATION CONSTRAINTS
INSTITUTIONAL CONSTRAINTS
INSTRUMENT
INTERNATIONAL BANK
INTRINSIC VALUE
JOB TRAINING
LABOR MARKET
LEVEL OF EDUCATION
LEVEL PLAYING FIELD
LITERACY
LIVING STANDARD
LIVING STANDARDS
LORENZ CURVE
LOW INCOME
LOW INCOMES
LOW-INCOME
LOW-INCOME INDIVIDUALS
LOW-INCOME PEOPLE
MARGINAL COST
MARGINAL RATE
MARGINAL RATES
MARGINAL TAX RATE
MARGINAL UTILITY
MARKET ECONOMY
MARKET FAILURE
MARKET STRUCTURE
MBI
MEASUREMENT FRAMEWORK
MICRODATA
OPPORTUNITY COST
OPPORTUNITY SET
OUTPUT
PAYROLL TAX
PERSONAL INCOME
PERSONAL INCOME TAX
POLITICAL ECONOMY
PRICE CHANGE
PRICE CHANGES
PRICE CONTROLS
PRICE ELASTICITY
PRIMARY EDUCATION
PRIVATE MARKET
PROBABILITIES
PROBABILITY
PRODUCTIVE INVESTMENT
PROGRESSIVE TAX
PROSPERITY
PUBLIC EXPENDITURE
PUBLIC EXPENDITURES
PUBLIC FINANCE
PUBLIC GOOD
PUBLIC GOODS
PUBLIC POLICIES
PUBLIC POLICY
PUBLIC SPENDING
RATES OF RETURN
REAL INCOME
REAL INCOME DECLINES
REGRESSION ANALYSIS
REGRESSIVE SUBSIDY
REGRESSIVE TAX
RELEVANT POPULATION
REMOTE AREAS
REMOTE REGIONS
RETIRED
RETIRED WORKERS
RETURNS
SALE
SALES
SAVINGS
SECONDARY EDUCATION
SHAREHOLDERS
SOCIAL ASSISTANCE
SOCIAL COST
SOCIAL SECURITY
SOCIAL SECURITY TAXES
SOCIAL SERVICES
SOCIAL WELFARE
SOCIAL WELFARE PROGRAM
STAKEHOLDERS
STOCK PRICES
SUBSTITUTION EFFECT
TAX
TAX ADMINISTRATION
TAX BASE
TAX EVASION
TAX INCIDENCE
TAX LIABILITIES
TAX LIABILITY
TAX POLICY
TAX PROVISIONS
TAX RATE
TAX RATES
TAX REFORM
TAX REVENUE
TAX SHIFTING
TAX STRUCTURE
TAX STRUCTURES
TAX SYSTEM
TAX TREATMENT
TAXABLE INCOME
TAXATION
TAXPAYERS
TOTAL COST
TRANSACTION
TRANSACTION COSTS
TRANSFER PAYMENTS
TREASURY
UTILITY FUNCTION
UTILITY MAXIMIZATION
VALUATION
VALUE ADDED
VALUE ADDED TAXES
VALUE JUDGMENTS
VERTICAL EQUITY
WAGE
WAGES
WEALTH
WEALTH TAXES
WELFARE ECONOMICS
spellingShingle ACCOUNTING
ACCURATE ESTIMATE
ADDITIONAL INCOME
ADMINISTRATIVE COST
ADMINISTRATIVE COSTS
AFTER TAX INCOME
AMOUNT OF INCOME
AMOUNT OF MONEY
ANALYTICAL METHODS
APARTHEID
BASE YEAR
BENCHMARK
BENEFICIARIES
BUSINESS TAX
BUSINESS TAXES
CALCULATIONS
CAPITAL EXPENDITURE
CAPITAL OWNERS
CASH TRANSFERS
CLAIMANTS
COMMODITIES
COMMODITY
COMMODITY PRICES
COMPARATIVE ADVANTAGE
COMPARATIVE ANALYSIS
COMPETITIVE MARKET
CONSUMER
CONSUMERS
CONSUMPTION EXPENDITURE
CONSUMPTION TAXES
CORPORATE INCOME TAX
CORPORATE INCOME TAXES
COST OF FUNDS
COST RECOVERY
CREDITS
CURRENT EXPENDITURE
DECISION MAKING
DEDUCTIONS
DEMOGRAPHIC
DERIVATIVE
DEVELOPING COUNTRIES
DIRECT COSTS
DISPOSABLE INCOME
DISTRIBUTION OF INCOME
DUMMY VARIABLE
EARNINGS
ECONOMETRIC ANALYSIS
ECONOMIC COSTS
ECONOMIC MANAGEMENT
ECONOMIC TRANSACTIONS
ELASTICITY
ELASTICITY OF DEMAND
ELASTICITY OF SUPPLY
EQUILIBRIUM
EQUILIBRIUM PRICES
EQUITY ISSUES
ETHNIC GROUPS
EXCISE TAXES
FACTORS OF PRODUCTION
FISCAL POLICY
FLAT TAX
GDP
GINI COEFFICIENT
GOVERNMENT ACTIONS
GOVERNMENT BUDGET
GOVERNMENT INTERVENTION
GOVERNMENT POLICY
GOVERNMENT SUBSIDY
HEALTH SPENDING
HORIZONTAL EQUITY
HOUSEHOLD EXPENDITURE
HOUSEHOLD INCOME
HOUSEHOLD SPENDING
HUMAN CAPITAL
IMMUNIZATION
INCENTIVE EFFECTS
INCOME EFFECT
INCOME GROUP
INCOME GROUPS
INCOME INCREASE
INCOME INCREASES
INCOME LEVEL
INCOME LEVELS
INCOME SOURCES
INCOMES
INCOMPLETE MARKETS
INFORMATION CONSTRAINTS
INSTITUTIONAL CONSTRAINTS
INSTRUMENT
INTERNATIONAL BANK
INTRINSIC VALUE
JOB TRAINING
LABOR MARKET
LEVEL OF EDUCATION
LEVEL PLAYING FIELD
LITERACY
LIVING STANDARD
LIVING STANDARDS
LORENZ CURVE
LOW INCOME
LOW INCOMES
LOW-INCOME
LOW-INCOME INDIVIDUALS
LOW-INCOME PEOPLE
MARGINAL COST
MARGINAL RATE
MARGINAL RATES
MARGINAL TAX RATE
MARGINAL UTILITY
MARKET ECONOMY
MARKET FAILURE
MARKET STRUCTURE
MBI
MEASUREMENT FRAMEWORK
MICRODATA
OPPORTUNITY COST
OPPORTUNITY SET
OUTPUT
PAYROLL TAX
PERSONAL INCOME
PERSONAL INCOME TAX
POLITICAL ECONOMY
PRICE CHANGE
PRICE CHANGES
PRICE CONTROLS
PRICE ELASTICITY
PRIMARY EDUCATION
PRIVATE MARKET
PROBABILITIES
PROBABILITY
PRODUCTIVE INVESTMENT
PROGRESSIVE TAX
PROSPERITY
PUBLIC EXPENDITURE
PUBLIC EXPENDITURES
PUBLIC FINANCE
PUBLIC GOOD
PUBLIC GOODS
PUBLIC POLICIES
PUBLIC POLICY
PUBLIC SPENDING
RATES OF RETURN
REAL INCOME
REAL INCOME DECLINES
REGRESSION ANALYSIS
REGRESSIVE SUBSIDY
REGRESSIVE TAX
RELEVANT POPULATION
REMOTE AREAS
REMOTE REGIONS
RETIRED
RETIRED WORKERS
RETURNS
SALE
SALES
SAVINGS
SECONDARY EDUCATION
SHAREHOLDERS
SOCIAL ASSISTANCE
SOCIAL COST
SOCIAL SECURITY
SOCIAL SECURITY TAXES
SOCIAL SERVICES
SOCIAL WELFARE
SOCIAL WELFARE PROGRAM
STAKEHOLDERS
STOCK PRICES
SUBSTITUTION EFFECT
TAX
TAX ADMINISTRATION
TAX BASE
TAX EVASION
TAX INCIDENCE
TAX LIABILITIES
TAX LIABILITY
TAX POLICY
TAX PROVISIONS
TAX RATE
TAX RATES
TAX REFORM
TAX REVENUE
TAX SHIFTING
TAX STRUCTURE
TAX STRUCTURES
TAX SYSTEM
TAX TREATMENT
TAXABLE INCOME
TAXATION
TAXPAYERS
TOTAL COST
TRANSACTION
TRANSACTION COSTS
TRANSFER PAYMENTS
TREASURY
UTILITY FUNCTION
UTILITY MAXIMIZATION
VALUATION
VALUE ADDED
VALUE ADDED TAXES
VALUE JUDGMENTS
VERTICAL EQUITY
WAGE
WAGES
WEALTH
WEALTH TAXES
WELFARE ECONOMICS
Essama-Nssah, B.
Assessing the Redistributive Effect of Fiscal Policy
relation Policy Research Working Paper No. 4592
description Who benefits from public spending? Who bears the burden of taxation? How desirable is the distribution of net benefits from the operation of a tax-benefit system? This paper surveys basic concepts, methods, and modeling approaches commonly used to address these issues in the context of fiscal incidence analysis. The review covers the incidence of both taxation and public spending. Methodological points are supported by country cases. The effective distribution of benefits and burdens associated with fiscal policy depends on the size of the government, the distributive mechanisms involved, and the incentives properties of the policy under consideration. This creates a need for analytical methods to account for both individual behavior and social interaction. The approaches reviewed include simple reduced form regression analysis, microsimulation models (both the envelope and discrete choice models), computable general equilibrium modeling, and approaches that link computable general equilibrium models to microsimulation models. Explicit modeling facilitates the construction of counterfactuals to back up causal analysis. Social desirability is assessed on the basis of progressivity along with deadweight loss.
format Publications & Research :: Policy Research Working Paper
author Essama-Nssah, B.
author_facet Essama-Nssah, B.
author_sort Essama-Nssah, B.
title Assessing the Redistributive Effect of Fiscal Policy
title_short Assessing the Redistributive Effect of Fiscal Policy
title_full Assessing the Redistributive Effect of Fiscal Policy
title_fullStr Assessing the Redistributive Effect of Fiscal Policy
title_full_unstemmed Assessing the Redistributive Effect of Fiscal Policy
title_sort assessing the redistributive effect of fiscal policy
publisher World Bank, Washington, DC
publishDate 2012
url http://documents.worldbank.org/curated/en/2008/04/9357308/assessing-redistributive-effect-fiscal-policy
http://hdl.handle.net/10986/6725
_version_ 1764400781511884800
spelling okr-10986-67252021-04-23T14:02:31Z Assessing the Redistributive Effect of Fiscal Policy Essama-Nssah, B. ACCOUNTING ACCURATE ESTIMATE ADDITIONAL INCOME ADMINISTRATIVE COST ADMINISTRATIVE COSTS AFTER TAX INCOME AMOUNT OF INCOME AMOUNT OF MONEY ANALYTICAL METHODS APARTHEID BASE YEAR BENCHMARK BENEFICIARIES BUSINESS TAX BUSINESS TAXES CALCULATIONS CAPITAL EXPENDITURE CAPITAL OWNERS CASH TRANSFERS CLAIMANTS COMMODITIES COMMODITY COMMODITY PRICES COMPARATIVE ADVANTAGE COMPARATIVE ANALYSIS COMPETITIVE MARKET CONSUMER CONSUMERS CONSUMPTION EXPENDITURE CONSUMPTION TAXES CORPORATE INCOME TAX CORPORATE INCOME TAXES COST OF FUNDS COST RECOVERY CREDITS CURRENT EXPENDITURE DECISION MAKING DEDUCTIONS DEMOGRAPHIC DERIVATIVE DEVELOPING COUNTRIES DIRECT COSTS DISPOSABLE INCOME DISTRIBUTION OF INCOME DUMMY VARIABLE EARNINGS ECONOMETRIC ANALYSIS ECONOMIC COSTS ECONOMIC MANAGEMENT ECONOMIC TRANSACTIONS ELASTICITY ELASTICITY OF DEMAND ELASTICITY OF SUPPLY EQUILIBRIUM EQUILIBRIUM PRICES EQUITY ISSUES ETHNIC GROUPS EXCISE TAXES FACTORS OF PRODUCTION FISCAL POLICY FLAT TAX GDP GINI COEFFICIENT GOVERNMENT ACTIONS GOVERNMENT BUDGET GOVERNMENT INTERVENTION GOVERNMENT POLICY GOVERNMENT SUBSIDY HEALTH SPENDING HORIZONTAL EQUITY HOUSEHOLD EXPENDITURE HOUSEHOLD INCOME HOUSEHOLD SPENDING HUMAN CAPITAL IMMUNIZATION INCENTIVE EFFECTS INCOME EFFECT INCOME GROUP INCOME GROUPS INCOME INCREASE INCOME INCREASES INCOME LEVEL INCOME LEVELS INCOME SOURCES INCOMES INCOMPLETE MARKETS INFORMATION CONSTRAINTS INSTITUTIONAL CONSTRAINTS INSTRUMENT INTERNATIONAL BANK INTRINSIC VALUE JOB TRAINING LABOR MARKET LEVEL OF EDUCATION LEVEL PLAYING FIELD LITERACY LIVING STANDARD LIVING STANDARDS LORENZ CURVE LOW INCOME LOW INCOMES LOW-INCOME LOW-INCOME INDIVIDUALS LOW-INCOME PEOPLE MARGINAL COST MARGINAL RATE MARGINAL RATES MARGINAL TAX RATE MARGINAL UTILITY MARKET ECONOMY MARKET FAILURE MARKET STRUCTURE MBI MEASUREMENT FRAMEWORK MICRODATA OPPORTUNITY COST OPPORTUNITY SET OUTPUT PAYROLL TAX PERSONAL INCOME PERSONAL INCOME TAX POLITICAL ECONOMY PRICE CHANGE PRICE CHANGES PRICE CONTROLS PRICE ELASTICITY PRIMARY EDUCATION PRIVATE MARKET PROBABILITIES PROBABILITY PRODUCTIVE INVESTMENT PROGRESSIVE TAX PROSPERITY PUBLIC EXPENDITURE PUBLIC EXPENDITURES PUBLIC FINANCE PUBLIC GOOD PUBLIC GOODS PUBLIC POLICIES PUBLIC POLICY PUBLIC SPENDING RATES OF RETURN REAL INCOME REAL INCOME DECLINES REGRESSION ANALYSIS REGRESSIVE SUBSIDY REGRESSIVE TAX RELEVANT POPULATION REMOTE AREAS REMOTE REGIONS RETIRED RETIRED WORKERS RETURNS SALE SALES SAVINGS SECONDARY EDUCATION SHAREHOLDERS SOCIAL ASSISTANCE SOCIAL COST SOCIAL SECURITY SOCIAL SECURITY TAXES SOCIAL SERVICES SOCIAL WELFARE SOCIAL WELFARE PROGRAM STAKEHOLDERS STOCK PRICES SUBSTITUTION EFFECT TAX TAX ADMINISTRATION TAX BASE TAX EVASION TAX INCIDENCE TAX LIABILITIES TAX LIABILITY TAX POLICY TAX PROVISIONS TAX RATE TAX RATES TAX REFORM TAX REVENUE TAX SHIFTING TAX STRUCTURE TAX STRUCTURES TAX SYSTEM TAX TREATMENT TAXABLE INCOME TAXATION TAXPAYERS TOTAL COST TRANSACTION TRANSACTION COSTS TRANSFER PAYMENTS TREASURY UTILITY FUNCTION UTILITY MAXIMIZATION VALUATION VALUE ADDED VALUE ADDED TAXES VALUE JUDGMENTS VERTICAL EQUITY WAGE WAGES WEALTH WEALTH TAXES WELFARE ECONOMICS Who benefits from public spending? Who bears the burden of taxation? How desirable is the distribution of net benefits from the operation of a tax-benefit system? This paper surveys basic concepts, methods, and modeling approaches commonly used to address these issues in the context of fiscal incidence analysis. The review covers the incidence of both taxation and public spending. Methodological points are supported by country cases. The effective distribution of benefits and burdens associated with fiscal policy depends on the size of the government, the distributive mechanisms involved, and the incentives properties of the policy under consideration. This creates a need for analytical methods to account for both individual behavior and social interaction. The approaches reviewed include simple reduced form regression analysis, microsimulation models (both the envelope and discrete choice models), computable general equilibrium modeling, and approaches that link computable general equilibrium models to microsimulation models. Explicit modeling facilitates the construction of counterfactuals to back up causal analysis. Social desirability is assessed on the basis of progressivity along with deadweight loss. 2012-05-30T22:14:56Z 2012-05-30T22:14:56Z 2008-04 http://documents.worldbank.org/curated/en/2008/04/9357308/assessing-redistributive-effect-fiscal-policy http://hdl.handle.net/10986/6725 English Policy Research Working Paper No. 4592 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research