Decomposing Changes in Income Inequality into Vertical and Horizontal Redistribution and Reranking, with Applications to China and Vietnam
It is acknowledged that the lack of any systematic link between growth and income inequality does not necessarily mean that economic growth is not accompanied by major changes in the underlying income distribution. The author uses a method devised to decompose the redistributive effect of a tax to a...
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| Format: | Policy Research Working Paper |
| Language: | English |
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World Bank, Washington, DC
2012
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| Online Access: | http://documents.worldbank.org/curated/en/2005/04/5731495/decomposing-changes-income-inequality-vertical-horizontal-redistribution-reranking-applications-china-vietnam http://hdl.handle.net/10986/8969 |
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okr-10986-89692021-04-23T14:02:42Z Decomposing Changes in Income Inequality into Vertical and Horizontal Redistribution and Reranking, with Applications to China and Vietnam Wagstaff, Adam BASE YEAR COMPARATIVE ADVANTAGE COUPONS CPI ECONOMIC GROWTH ECONOMIC INEQUALITY ECONOMIC RESEARCH ECONOMISTS EMPIRICAL ANALYSIS FARM INCOME FISH GDP GINI COEFFICIENT GINI INDEX HORIZONTAL EQUITY HOUSEHOLD CONSUMPTION HOUSEHOLD INCOME HUMAN CAPITAL INCOME INCOME DISTRIBUTION INCOME INEQUALITY INCOME SHARES INEQUALITY MEASURES INTERNATIONAL TRADE LAND REFORM LIVING STANDARDS LORENZ CURVE MARKET ECONOMIES MEAN INCOME PER CAPITA CONSUMPTION PER CAPITA INCOME PER CAPITA INCOME/CONSUMPTION PERSONAL INCOME TAXES POLITICAL ECONOMY POOR PRICE DIFFERENCES SELECTION BIAS TAX REFORM TAXATION TRADE REFORMS TRANSITION ECONOMIES TRANSITION ECONOMY VERTICAL EQUITY It is acknowledged that the lack of any systematic link between growth and income inequality does not necessarily mean that economic growth is not accompanied by major changes in the underlying income distribution. The author uses a method devised to decompose the redistributive effect of a tax to analyze the extent to which vertical redistribution associated with changing incomes over time is offset or reinforced by horizontal redistribution and re-ranking. He uses panel data from China and Vietnam over a period when both countries grew spectacularly as they transitioned from planned to market economies, and yet experienced smaller annual percentage increases in income inequality. The results suggest that substantial amounts of horizontal redistribution and re-ranking in both China-and to a lesser extent Vietnam-more than offset pro-poor vertical redistribution. Without the horizontal redistribution and re-ranking, the Gini coefficient for China might have fallen between 1989 and 1997-substantially so. 2012-06-25T20:46:57Z 2012-06-25T20:46:57Z 2005-04 http://documents.worldbank.org/curated/en/2005/04/5731495/decomposing-changes-income-inequality-vertical-horizontal-redistribution-reranking-applications-china-vietnam http://hdl.handle.net/10986/8969 English Policy Research Working Paper; No. 3559 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 East Asia and Pacific China Vietnam |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English |
| topic |
BASE YEAR COMPARATIVE ADVANTAGE COUPONS CPI ECONOMIC GROWTH ECONOMIC INEQUALITY ECONOMIC RESEARCH ECONOMISTS EMPIRICAL ANALYSIS FARM INCOME FISH GDP GINI COEFFICIENT GINI INDEX HORIZONTAL EQUITY HOUSEHOLD CONSUMPTION HOUSEHOLD INCOME HUMAN CAPITAL INCOME INCOME DISTRIBUTION INCOME INEQUALITY INCOME SHARES INEQUALITY MEASURES INTERNATIONAL TRADE LAND REFORM LIVING STANDARDS LORENZ CURVE MARKET ECONOMIES MEAN INCOME PER CAPITA CONSUMPTION PER CAPITA INCOME PER CAPITA INCOME/CONSUMPTION PERSONAL INCOME TAXES POLITICAL ECONOMY POOR PRICE DIFFERENCES SELECTION BIAS TAX REFORM TAXATION TRADE REFORMS TRANSITION ECONOMIES TRANSITION ECONOMY VERTICAL EQUITY |
| spellingShingle |
BASE YEAR COMPARATIVE ADVANTAGE COUPONS CPI ECONOMIC GROWTH ECONOMIC INEQUALITY ECONOMIC RESEARCH ECONOMISTS EMPIRICAL ANALYSIS FARM INCOME FISH GDP GINI COEFFICIENT GINI INDEX HORIZONTAL EQUITY HOUSEHOLD CONSUMPTION HOUSEHOLD INCOME HUMAN CAPITAL INCOME INCOME DISTRIBUTION INCOME INEQUALITY INCOME SHARES INEQUALITY MEASURES INTERNATIONAL TRADE LAND REFORM LIVING STANDARDS LORENZ CURVE MARKET ECONOMIES MEAN INCOME PER CAPITA CONSUMPTION PER CAPITA INCOME PER CAPITA INCOME/CONSUMPTION PERSONAL INCOME TAXES POLITICAL ECONOMY POOR PRICE DIFFERENCES SELECTION BIAS TAX REFORM TAXATION TRADE REFORMS TRANSITION ECONOMIES TRANSITION ECONOMY VERTICAL EQUITY Wagstaff, Adam Decomposing Changes in Income Inequality into Vertical and Horizontal Redistribution and Reranking, with Applications to China and Vietnam |
| geographic_facet |
East Asia and Pacific China Vietnam |
| relation |
Policy Research Working Paper; No. 3559 |
| description |
It is acknowledged that the lack of any systematic link between growth and income inequality does not necessarily mean that economic growth is not accompanied by major changes in the underlying income distribution. The author uses a method devised to decompose the redistributive effect of a tax to analyze the extent to which vertical redistribution associated with changing incomes over time is offset or reinforced by horizontal redistribution and re-ranking. He uses panel data from China and Vietnam over a period when both countries grew spectacularly as they transitioned from planned to market economies, and yet experienced smaller annual percentage increases in income inequality. The results suggest that substantial amounts of horizontal redistribution and re-ranking in both China-and to a lesser extent Vietnam-more than offset pro-poor vertical redistribution. Without the horizontal redistribution and re-ranking, the Gini coefficient for China might have fallen between 1989 and 1997-substantially so. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Wagstaff, Adam |
| author_facet |
Wagstaff, Adam |
| author_sort |
Wagstaff, Adam |
| title |
Decomposing Changes in Income Inequality into Vertical and Horizontal Redistribution and Reranking, with Applications to China and Vietnam |
| title_short |
Decomposing Changes in Income Inequality into Vertical and Horizontal Redistribution and Reranking, with Applications to China and Vietnam |
| title_full |
Decomposing Changes in Income Inequality into Vertical and Horizontal Redistribution and Reranking, with Applications to China and Vietnam |
| title_fullStr |
Decomposing Changes in Income Inequality into Vertical and Horizontal Redistribution and Reranking, with Applications to China and Vietnam |
| title_full_unstemmed |
Decomposing Changes in Income Inequality into Vertical and Horizontal Redistribution and Reranking, with Applications to China and Vietnam |
| title_sort |
decomposing changes in income inequality into vertical and horizontal redistribution and reranking, with applications to china and vietnam |
| publisher |
World Bank, Washington, DC |
| publishDate |
2012 |
| url |
http://documents.worldbank.org/curated/en/2005/04/5731495/decomposing-changes-income-inequality-vertical-horizontal-redistribution-reranking-applications-china-vietnam http://hdl.handle.net/10986/8969 |
| _version_ |
1764407168189071360 |