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Implementation Issues in the Duclos–Jalbert–Araar Decomposition of Redistributive Effect

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  • Ivica Urban

Abstract

Models decomposing the redistributive effect of fiscal systems into vertical and horizontal effects are extensively used by practitioners. Duclos, Jalbert, and Araar’s model, despite its advantages, has not yet been widely employed in empirical research, possibly due to a relatively challenging implementation procedure that involves the estimation of expected postfiscal incomes. To override these difficulties, the designers of the software DAD have incorporated a module for implementation of the model. However, the application of this module on Croatian tax-benefit system data revealed certain inaccuracies in the results. Carefully unfolding the calculation and estimation procedures needed for implementation of the model, this article instructs practitioners on how to correctly apply the model and helps DAD designers improve their module.

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  • Ivica Urban, 2013. "Implementation Issues in the Duclos–Jalbert–Araar Decomposition of Redistributive Effect," Public Finance Review, , vol. 41(1), pages 121-143, January.
    • Handle: RePEc:sae:pubfin:v:41:y:2013:i:1:p:121-143
    DOI: 10.1177/1091142112452777
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    Cited by:

    1. Ivica Urban, 2016. "Impact of Taxes and Benefits on Inequality among Groups of Income Units," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 62(1), pages 120-144, March.
    2. Stefano Boscolo, 2020. "On the Horizontal Inequity Effect of the Erosion of the PIT Base: The Case of Italy," Department of Economics (DEMB) 0176, University of Modena and Reggio Emilia, Department of Economics "Marco Biagi".
    3. Nora Lustig, 2016. "Commitment to Equity Handbook. A Guide to Estimating the Impact of Fiscal Policy on Inequality and Poverty," Commitment to Equity (CEQ) Working Paper Series 1301, Tulane University, Department of Economics.
    4. Stefano Boscolo, 2020. "On the Horizontal Inequity Effect of the Erosion of the PIT Base: The Case of Italy," Department of Economics 0176, University of Modena and Reggio E., Faculty of Economics "Marco Biagi".
    5. Mitja ÄŒok & Ivica Urban & Miroslav VerbiÄ, 2013. "Income Redistribution through Taxes and Social Benefits: The Case of Slovenia and Croatia," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 60(5), pages 667-686, September.

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