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Measuring lifetime redistribution in Dutch collective arrangements

  • Harry ter Rele

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    This paper assesses how the system of Dutch collective arrangements redistributes between the rich and the poor. It incorporates the full life cycle in the measurements, rather than only the annual effects, and includes a larger part of the arrangements than is usually the case. The measurements on redistribution are carried out using the level of educational attainment to classify the population. For an average, representative person of each level of education we measure, in terms of present values, the average net benefit from government. The results show that the net benefits are positive for the lower levels of education and negative for the higher levels. The figures indicate a sizable redistribution from the rich to the poor and a significant reduction of welfare inequality. The net effect on income inequality is, however, substantially smaller than when it is measured on an annual basis.

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    File URL: http://www.cpb.nl/sites/default/files/publicaties/download/measuring-lifetime-redistribution-dutch-collective-arrangements.pdf
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    Paper provided by CPB Netherlands Bureau for Economic Policy Analysis in its series CPB Document with number 79.

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    Date of creation: Feb 2005
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    Handle: RePEc:cpb:docmnt:79
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    1. David Altig & Alan J. Auerbach & Laurence J. Kotlikoff & Kent A. Smetters & Jan Walliser, 1997. "Simulating U.S. tax reform," Working Paper 9712, Federal Reserve Bank of Cleveland.
    2. Alan L. Gustman & Thomas L. Steinmeier, 2000. "How Effective is Redistribution Under the Social Security Benefit Formula?," NBER Working Papers 7597, National Bureau of Economic Research, Inc.
    3. Jagadeesh Gokhale & Laurence J. Kotlikoff & Alexi Sluchynsky, 2002. "Does it pay to work?," Working Paper 0206, Federal Reserve Bank of Cleveland.
    4. Nelissen, Jan H. M., 1998. "Annual versus lifetime income redistribution by social security," Journal of Public Economics, Elsevier, vol. 68(2), pages 223-249, May.
    5. Jeffrey B. Liebman, 2002. "Redistribution in the Current U.S. Social Security System," NBER Chapters, in: The Distributional Aspects of Social Security and Social Security Reform, pages 11-48 National Bureau of Economic Research, Inc.
    6. Don Fullerton & Diane Lim Rogers, 1994. "Distributional Effects on a Lifetime Basis," NBER Working Papers 4862, National Bureau of Economic Research, Inc.
    7. Courtney Coile & Jonathan Gruber, 2000. "Social Security and Retirement," NBER Working Papers 7830, National Bureau of Economic Research, Inc.
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