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The “Forgotten” Income Component? The inequality effect of including the value of public services in the income concept

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  • Gerlinde Verbist

Abstract

Distributional analyses mainly focus on inequality of cash incomes. However, it can be argued that also the benefits households derive from publicly provided services should be taken into account. In this article we focus on the distribution effects of the two major categories of publicly provided services in Belgium, namely education and health care services. We discuss conceptual and methodological issues related to including the value of public services in the income concept. Using data from EU-SILC, we find that including in-kind benefits for education and health care in the income concept leads to a considerable decline in income inequality in Belgium. JEL codes: D31, I14, I24, I38

Suggested Citation

  • Gerlinde Verbist, 2011. "The “Forgotten” Income Component? The inequality effect of including the value of public services in the income concept," Reflets et perspectives de la vie économique, De Boeck Université, vol. 0(4), pages 169-178.
  • Handle: RePEc:cai:rpvedb:rpve_504_0169
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    More about this item

    Keywords

    income distribution; income in-kind; education; health care;

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • I14 - Health, Education, and Welfare - - Health - - - Health and Inequality
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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