Horizontal Inequity and Vertical Redistribution with Indirect Taxes: the Greek Case
Non-uniform indirect taxes treat equals and those unequal differently (horizontal inequity and vertical redistribution). Horizontal inequity is caused by taste differences among similar households, but some excises are designed to reflect social, not revealed, preferences. We apply two methodologies for decomposing the overall redistributive effect of the present and three alternative indirect tax structures into vertical and horizontal effects for Greece, using the Household Expenditure Survey micro-database. In all cases the taste component is considerable, even when we allow for social preferences, while improvements in vertical redistribution can be achieved, albeit at the cost of increased horizontal inequity.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Newbery, David M, 1988. "Charging for Roads," World Bank Research Observer, World Bank Group, vol. 3(2), pages 119-38, July.
- Creedy, J. & Lambert, P.J. & Van de Ven, J., 1998. "The Redistributive Effect of Taxation Revisited," Department of Economics - Working Papers Series 657, The University of Melbourne.
- Jérôme Adda & Francesca Cornaglia, 2006.
"Taxes, Cigarette Consumption, and Smoking Intensity,"
American Economic Review,
American Economic Association, vol. 96(4), pages 1013-1028, September.
- Adda, Jérôme & Cornaglia, Francesca, 2005. "Taxes, Cigarette Consumption and Smoking Intensity," IZA Discussion Papers 1849, Institute for the Study of Labor (IZA).
- Nicholas Stern, 1990. "Uniformity Versus Selectivity In Indirect Taxation," Economics and Politics, Wiley Blackwell, vol. 2(1), pages 83-108, 03.
- Nelson, Julie A, 1993. "Household Equivalence Scales: Theory versus Policy?," Journal of Labor Economics, University of Chicago Press, vol. 11(3), pages 471-93, July.
- Wagstaff, Adam & van Doorslaer, Eddy & van der Burg, Hattem & Calonge, Samuel & Christiansen, Terkel & Citoni, Guido & Gerdtham, Ulf-G. & Gerfin, Michael & Gross, Lorna & Hakinnen, Unto, 1999. "Redistributive effect, progressivity and differential tax treatment: Personal income taxes in twelve OECD countries," Journal of Public Economics, Elsevier, vol. 72(1), pages 73-98, April.
When requesting a correction, please mention this item's handle: RePEc:cam:camdae:0806. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jake Dyer)
If references are entirely missing, you can add them using this form.