Notable Linkage: Redistribution Policy and Inequality Reduction in OECD Countries: What Has Changed in Two Decades? by Herwig Immervoll, Linda Richardson :: SSRN

Excerpt:

We use a range of data sources to assess if government redistribution policies have slowed or accelerated the trend towards greater income disparities in the past 20-25 years. In most countries, inequality among “non-elderly” households has widened during most phases of the economic cycle and any episodes of narrowing income differentials have usually not lasted long enough to close the gap between high and low incomes that had opened up previously. With progressive redistribution systems in place, greater inequality automatically leads to more redistribution, even if no policy action is taken. We find that, in the context of rising market-income inequality, tax-benefit systems have indeed become more redistributive since the 1980s but that this did not stop income inequality from rising: market-income inequality grew by twice as much as redistribution. Between the mid-1990s and the mid-2000s, the redistributive strength of tax-benefit systems then weakened in many countries.

Redistribution Policy and Inequality Reduction in OECD Countries: What Has Changed in Two Decades? by Herwig Immervoll, Linda Richardson :: SSRN

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