Tax-benefit systems, income distribution and work incentives in the European Union
AbstractIn this paper we study the impact of tax-benefit systems on income inequality and work incentives across the 27 Member States of the European Union (EU). Using EUROMOD, the EU-wide tax-benefit microsimulation model, we disentangle the role of taxes, benefits and social insurance contributions in influencing country specific Gini coefficients and Marginal Effective Tax Rates. The extent to which tax-benefit systems contribute to income redistribution and provide work incentives at the intensive margin is found to vary considerably across the 27 Member States of the EU. Our results further highlight the presence of a trade-off between income redistribution and work incentives across EU-27 countries.
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Bibliographic InfoArticle provided by Interational Microsimulation Association in its journal International Journal of Microsimulation.
Volume (Year): 1 (2013)
Issue (Month): 6 ()
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Web page: http://ima.natsem.canberra.edu.au/index.htm
Inequality; work incentives; tax-benefit systems; microsimulation;
Find related papers by JEL classification:
- C15 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Statistical Simulation Methods: General
- D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
- H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
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