Fiscal Studies最新文献

The evolution of labour market and disposable income inequalities over recent decades in high-income countries has generated intense interest in academia and the wider public. The extent to which there have been common trends, or diverging experiences, across a broad range of different countries, remains relatively understudied. The papers in this two-part special issue seek to provide the bases for consistent comparisons across 17 North American and European countries. In this Introduction we provide background for the cross-country project, which has been conducted in parallel to the wider IFS Deaton Review of Inequalities. In addition, we provide brief summaries of key trends and findings in the four English-speaking countries and four Nordic countries, as well as a companion paper on gender pay gaps across all 17 countries.

We assess the evolution of inequality over time in Norway and the underlying factors which determine such changes. Inequality is low in Norway, and remains relatively unchanged from 1980 to 2019. However, these aggregate measures mask persistent inequalities across sex, education and immigrant status. Among men, inequality increases from 1980 while the opposite is true for women. Low-educated workers fare increasingly worse over time relative to middle- and high-educated workers. Despite this, the earnings of women lag behind those of lower-educated men and considerable gender gaps exist. While immigration increases considerably, immigration itself does not drive the rise in inequality among men. Decomposing the importance of unions for earnings reveals that the declining importance of unionisation for earnings among men in the bottom half of the distribution may be an important factor behind rising inequality.

This paper examines trends in working-age labour market and disposable income inequalities in the United Kingdom from 1968 to 2021 using microdata harmonised with 16 other high-income countries. In the UK, the 1980s was a period of rising labour market inequalities and inequality in disposable incomes. Since the 1980s, changes have been more modest. Changing hours of work and changes in family structure have been important for understanding trends in individual and household earnings inequalities, respectively. Tax and benefit reforms have also played an important role in driving disposable income inequalities, with notable redistribution towards low-income households between 1997 and 2010. We also provide evidence on the effects of the COVID-19 pandemic in the UK. Disposable income inequality fell slightly as increases in state benefits during the pandemic boosted incomes of poorer households.

We examine trends in household disposable income inequality and potential mechanisms shaping inequality through changes to work, wages, earnings, marriage, and the tax and transfer system in the United States over the nearly five-decade period from 1975 to 2022. Overall after-tax and transfer income inequality increased more than 25 per cent since the mid-1970s, and by as much as 50 per cent when comparing the 90^th and 10^th percentiles. While there has been substantial upgrading in formal education credentials among both men and women – an inequality-reducing development – those with fewer credentials have increasingly been less likely to work and marry, each of which could result in higher inequality. The latter effects are exacerbated by those selecting into marriage and cohabitation being more likely to partner with those holding similar educational credentials and earning power. Moreover, the decline in work among the less skilled coincided with the transformation of the safety net to rewarding work. These demographic and policy changes have resulted in a pulling apart of the US income distribution.

We present the extent of divergence in the literature on the stylised facts about income redistribution in rich countries. Analytical choices that underpin this divergence are then identified and investigated empirically using microdata for 30 European countries. In terms of direct redistribution via cash transfers and direct taxes, whether social insurance pensions are treated as redistribution – the conventional approach – or as market income – as in some recent studies – is seen to be critical. When the analysis is extended to include indirect taxes and non-cash benefits from state spending, they work in opposite directions and generally have only a limited net redistributive impact. Being able to attribute the benefits of such spending to households in more satisfactory ways is a priority. Whether household survey data are ‘corrected’ to include missing incomes at the top as well as imputed rent of owner-occupiers and undistributed profits of companies is also seen to have a substantial impact on the scale of measured redistribution. Finally, extending the scope of redistributive analysis to include all of national income, as in recent studies from a Distributional National Accounts perspective, is investigated. This underlines the implications of including state spending on collective goods such as security and infrastructure, without a clear rationale for how it is meaningfully allocated across households.

In this paper, we analyse the potential impact of policies aimed at fostering fiscal sustainability on citizens’ preferences. A survey specifically designed for this purpose quantifies citizens’ knowledge and concern about fiscal imbalances and the institutional framework that addresses them in Spain, and their possible electoral reactions to public spending cuts and tax increases. Using both ordered and unordered multinomial probit models, we corroborate that citizens tend to disapprove of retrenchment policies. However, the effect on citizens’ voting intentions varies depending on their political ideology. We confirm that left-wing voters supporting the incumbent coalition parties prefer austerity policies based on the revenue side of the budget, while right-wing voters tend to approve retrenchments based on the expenditure side to a larger extent.

Top incomes tend to be under-represented in survey data, making survey income distributions unrepresentative of the true ones in terms of the amount of total income and, if some of its components (sources) are missing relatively more than others, in terms of the structure of total income by components. Since the correct structure is important for some analyses, correction is warranted. Using Croatian survey and tax records data, we show that the survey correction method of Blanchet, Flores and Morgan (2022), based on reweighting and replacement of top incomes using tax records data – which corrects total income – can fail to correct its structure by components. This happens when some income components – in our case, primarily capital income – are missing much more than others, making the structure substantially different from the correct one and difficult to correct through reweighting and replacement of total income. As a solution, we propose a pre-correction and a post-correction, each involving income replacement based on tax records data, as supplements to the Blanchet et al. method. Either supplement substantially improves the correction of both total income and its structure by source.

This paper provides new empirical evidence on the role of landfill taxes in reducing landfill waste and promoting recycling. We focus on the impacts of the 2017 landfill tax law reform in Catalonia, a Spanish region, which increased the tax rate from 18 to 47 euros per tonne over the period 2017–20. Using municipality-level data for Catalonia from the 2013–20 period, we contrast municipalities that differed in the use of door-to-door waste collection by the beginning of our study period. As door-to-door waste collection is advocated as especially efficient at reducing landfill waste, we hypothesise that municipalities that had not yet adopted this system had greater leeway in responding to the tax changes. Based on a two-way fixed effects design, our findings reveal large differential responses to the tax hike. Compared with municipalities that had implemented door-to-door waste collection by 2013, we estimate that those that had not done this responded to the tax hike by reducing landfill waste by an additional 12 per cent, reducing total waste by 4 per cent, and increasing the share of recycled waste and waste that is sorted as organic by 6 and 2.5 percentage points, respectively. We provide suggestive evidence that the adoption of door-to-door waste collection is the main mechanism driving these responses.

Since the turn of the millennium, the UK has relied almost exclusively on two policies to address the adverse consequences of low pay and labour market inequality: in-work tax credits and the minimum wage. Successful as these policies have been at supporting family incomes and propping up hourly wages at the bottom, increasing numbers of less-educated workers find themselves in low-quality jobs with negligible wage growth, little training and poor career prospects. Work by itself is rarely a route to earnings progression. This paper looks at the motivation behind the expansion of in-work tax credits in the face of growing wage inequality and in-work poverty. It focuses on the impact on longer-term outcomes through human capital and skills. It argues for a balance of policies that goes beyond tax credits and the minimum wage to foster individual wage growth and improve opportunities for career progression for less-educated workers.