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Redistribution Of Income—Notes On Some Problems And Puzzles

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  • J. L. Nicholson

Abstract

There are both major philosophical and major econometric questions to be faced in the measurement of inequality of income. The scaling of different sizes and types of families can never be unique and may be a function of real income. However, even subjective guesses may be better than doing nothing. Demographic changes, such as the increase in pensioners with the increase in life expectancy, affects the distribution of income, and it seems desirable to estimate the separate effect of their influence. The extent to which the inequality of incomes is reduced by all taxes and benefits combined has remained remarkably constant in the U.K. over the period for which estimates have been made (1937–1967). The progressive effect of all taxes and benefits combined is largely the result of benefits (in cash and kind). The stability in the degree of inequality of original income is much more difficult to explain. A number of factors which reduce or increase inequality can be identified for further analysis.

Suggested Citation

  • J. L. Nicholson, 1970. "Redistribution Of Income—Notes On Some Problems And Puzzles," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 16(3), pages 273-278, March.
  • Handle: RePEc:bla:revinw:v:16:y:1970:i:3:p:273-278
    DOI: 10.1111/j.1475-4991.1970.tb00703.x
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