Analysis of Intergenerational Inequality: the Role of Public Expenditure and Taxation

Emanuele, Canegrati (2008): Analysis of Intergenerational Inequality: the Role of Public Expenditure and Taxation.

Abstract

In this paper I analyse the impact of public expenditure and income taxation on intergenerational inequality for seventeen countries. Age group Gini index is calculated by using data from the Luxemburg Income Study (LIS). Results are very robust in demonstrating that only income taxation is able to influence the level of intergenerational inequality, since it directly a¤ects the wealth of households. Otherwise, public expenditure seems to have no impact on individuals' welfare, even if we consider public expenditure components which should be tailored for specific cohorts. Different hypotheses on standard errors are considered, in order to detect the presence of one-way or two-way fixed effects.

• Item Type: MPRA Paper
• Language: English
• Keywords: Age group inequality, Public Expenditure, Income Taxa- tion
• Subjects: E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook > E62 - Fiscal Policy; D - Microeconomics > D6 - Welfare Economics > D63 - Equity, Justice, Inequality, and Other Normative Criteria and Measurement; H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H24 - Personal Income and Other Nonbusiness Taxes and Subsidies

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