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

European countries have the world's most redistributive tax and transfer systems. Although they have been well equipped to deal with vertical inequality -- that is, fostering redistribution from the rich to the poor -- less is known about...

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Main Authors:	Bussolo, Maurizio, Krolage, Carla, Makovec, Mattia, Peichl, Andreas, Stockli, Marc, Torre, Ivan, Wittneben, Christian
Format:	Working Paper
Language:	English
Published:	World Bank, Washington, DC 2018
Subjects:	INEQUALITY INCOME DISTRIBUTION TAXATION TRANSFERS INCIDENCE ANALYSIS VERTICAL INEQUALITY HORIZONTAL INEQUALITY REDISTRIBUTION
Online Access:	http://documents.worldbank.org/curated/en/375081543509025568/Vertical-and-Horizontal-Redistribution-The-Cases-of-Western-and-Eastern-Europe http://hdl.handle.net/10986/30930

id	okr-10986-30930
recordtype	oai_dc
spelling	okr-10986-309302021-06-08T14:42:45Z Vertical and Horizontal Redistribution : The Cases of Western and Eastern Europe Bussolo, Maurizio Krolage, Carla Makovec, Mattia Peichl, Andreas Stockli, Marc Torre, Ivan Wittneben, Christian INEQUALITY INCOME DISTRIBUTION TAXATION TRANSFERS INCIDENCE ANALYSIS VERTICAL INEQUALITY HORIZONTAL INEQUALITY REDISTRIBUTION European countries have the world's most redistributive tax and transfer systems. Although they have been well equipped to deal with vertical inequality -- that is, fostering redistribution from the rich to the poor -- less is known about their performance in dealing with horizontal inequality, that is, in redistributing among socioeconomic groups. In a context where individuals may not only care about vertical redistribution, but also about the economic situation of the specific groups to which they belong, the horizontal dimension of redistribution becomes politically salient and can be a source of social tensions. This paper analyzes the performance of the 28 EU countries on redistribution across (i) age groups, (ii) occupational groups, and (iii) household types over 2007–2014 using counterfactual simulation techniques. The analysis finds a great degree of heterogeneity across countries: changes in the tax and transfer system have particularly hit the young and losers of occupational change in Eastern European countries, while households with greater economic security have benefited from these changes. The findings suggest that horizontal inequality is a dimension that policy makers should take into account when reforming tax and transfer systems. 2018-12-03T22:26:17Z 2018-12-03T22:26:17Z 2018-11 Working Paper http://documents.worldbank.org/curated/en/375081543509025568/Vertical-and-Horizontal-Redistribution-The-Cases-of-Western-and-Eastern-Europe http://hdl.handle.net/10986/30930 English Policy Research Working Paper;No. 8657 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 Europe and Central Asia Eastern Europe European Union
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	INEQUALITY INCOME DISTRIBUTION TAXATION TRANSFERS INCIDENCE ANALYSIS VERTICAL INEQUALITY HORIZONTAL INEQUALITY REDISTRIBUTION
spellingShingle	INEQUALITY INCOME DISTRIBUTION TAXATION TRANSFERS INCIDENCE ANALYSIS VERTICAL INEQUALITY HORIZONTAL INEQUALITY REDISTRIBUTION Bussolo, Maurizio Krolage, Carla Makovec, Mattia Peichl, Andreas Stockli, Marc Torre, Ivan Wittneben, Christian Vertical and Horizontal Redistribution : The Cases of Western and Eastern Europe
geographic_facet	Europe and Central Asia Eastern Europe European Union
relation	Policy Research Working Paper;No. 8657
description	European countries have the world's most redistributive tax and transfer systems. Although they have been well equipped to deal with vertical inequality -- that is, fostering redistribution from the rich to the poor -- less is known about their performance in dealing with horizontal inequality, that is, in redistributing among socioeconomic groups. In a context where individuals may not only care about vertical redistribution, but also about the economic situation of the specific groups to which they belong, the horizontal dimension of redistribution becomes politically salient and can be a source of social tensions. This paper analyzes the performance of the 28 EU countries on redistribution across (i) age groups, (ii) occupational groups, and (iii) household types over 2007–2014 using counterfactual simulation techniques. The analysis finds a great degree of heterogeneity across countries: changes in the tax and transfer system have particularly hit the young and losers of occupational change in Eastern European countries, while households with greater economic security have benefited from these changes. The findings suggest that horizontal inequality is a dimension that policy makers should take into account when reforming tax and transfer systems.
format	Working Paper
author	Bussolo, Maurizio Krolage, Carla Makovec, Mattia Peichl, Andreas Stockli, Marc Torre, Ivan Wittneben, Christian
author_facet	Bussolo, Maurizio Krolage, Carla Makovec, Mattia Peichl, Andreas Stockli, Marc Torre, Ivan Wittneben, Christian
author_sort	Bussolo, Maurizio
title	Vertical and Horizontal Redistribution : The Cases of Western and Eastern Europe
title_short	Vertical and Horizontal Redistribution : The Cases of Western and Eastern Europe
title_full	Vertical and Horizontal Redistribution : The Cases of Western and Eastern Europe
title_fullStr	Vertical and Horizontal Redistribution : The Cases of Western and Eastern Europe
title_full_unstemmed	Vertical and Horizontal Redistribution : The Cases of Western and Eastern Europe
title_sort	vertical and horizontal redistribution : the cases of western and eastern europe
publisher	World Bank, Washington, DC
publishDate	2018
url	http://documents.worldbank.org/curated/en/375081543509025568/Vertical-and-Horizontal-Redistribution-The-Cases-of-Western-and-Eastern-Europe http://hdl.handle.net/10986/30930
_version_	1764473248113754112

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

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