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Measuring the impact of redistribution on income inequality and polarization

Author

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  • Maria Molnar

    (Institute of National Economy – Romanian Academy)

Abstract

The redistribution, i.e. social transfers (benefits), taxes and social contributions, has an important contribution in reducing income inequality and polarization, the tax-benefit system being the main instrument of the income policy. The paper presents the results of an evaluation of the impact of income redistribution on households’ income inequality and polarization in Romania during 1995 to 2008 years. In the first part of the paper the main methodological issues of the measurement are being reviewed. According to the results of the measurement, which are dealt with in the second section, the redistribution had an increasing lessening effect on the extent of inequality and polarization. The social transfers, especially pensions, were the main equalising component of the redistribution over the entire period.

Suggested Citation

  • Maria Molnar, 2010. "Measuring the impact of redistribution on income inequality and polarization," Annals - Economy Series, Constantin Brancusi University, Faculty of Economics, vol. 4, pages 7-27, December.
    • Handle: RePEc:cbu:jrnlec:y:2010:v:4.i:p:7-27
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    References listed on IDEAS

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    4. Stephanie Moller & Francois Nielsen & John D. Stephens & Evelyne Huber & David Bradley, 2001. "Distribution and Redistribution in Post-Industrial Democracies," LIS Working papers 265, LIS Cross-National Data Center in Luxembourg.
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    6. Vincent Mahler & David Jesuit, 2004. "State Redistribution in Comparative Perspective: A Cross-National Analysis of the Developed Countries," LIS Working papers 392, LIS Cross-National Data Center in Luxembourg.
    7. Dag Ehrenpreis, 2007. "The challenge of Inequality," Policy In Focus 11, International Policy Centre.
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