IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

Comparing the incidence of taxes and social spending in Brazil and the United States

  • Sean Higgins

    (Department of Economics, Tulane University, USA)

  • Nora Lustig

    (Department of Economics, Tulane University, USA)

  • Whitney Ruble

    (Department of Economics, Tulane University, USA)

  • Timothy Smeeding

    (University of Wisconsin at Madison, USA)

We perform the first comprehensive fiscal incidence analyses in Brazil and the US, including direct cash and food transfers, targeted housing and heating subsidies, public spending on education and health, and personal income, payroll, corporate income, property, and expenditure taxes. In both countries, primary spending is close to 40 percent of GDP. The US achieves higher redistribution through direct taxes and transfers, primarily due to underutilization of the personal income tax in Brazil and the fact that Brazil’s highly progressive cash and food transfer programs are small while larger transfer programs are less progressive. However, when health and non-tertiary education spending are added to income using the government cost approach, the two countries achieve similar levels of redistribution. This result may be a reflection of better-off households in Brazil opting out of public services due to quality concerns rather than a result of government effort to make spending more equitable.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.ecineq.org/milano/WP/ECINEQ2013-316.pdf
Download Restriction: no

Paper provided by ECINEQ, Society for the Study of Economic Inequality in its series Working Papers with number 316.

as
in new window

Length: 39 pages
Date of creation: Nov 2013
Date of revision:
Handle: RePEc:inq:inqwps:ecineq2013-316
Contact details of provider: Web page: http://www.ecineq.org
Email:


More information through EDIRC

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.:

as in new window
  1. Francisco H. G. Ferreira & Jérémie Gignoux, 2011. "The Measurement Of Inequality Of Opportunity: Theory And An Application To Latin America," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 57(4), pages 622-657, December.
  2. Lustig, Nora & Lopez-Calva, Luis F. & Ortiz-Juarez, Eduardo, 2012. "Declining inequality in Latin America in the 2000s : the cases of Argentina, Brazil, and Mexico," Policy Research Working Paper Series 6248, The World Bank.
  3. François Bourguignon & Francisco H. G. Ferreira & Marta Menéndez, 2007. "Inequality Of Opportunity In Brazil," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 53(4), pages 585-618, December.
  4. repec:dau:papers:123456789/1552 is not listed on IDEAS
  5. Rolf Aaberge & Anders Björklund & Markus Jäntti & Mårten Palme & Peder J. Pedersen & Nina Smith & Tom Wennemo, 1996. "Income Inequality and Income Mobility in the Scandinavian Countries Compared to the United States," Discussion Papers 168, Statistics Norway, Research Department.
  6. Nora Lustig & Carola Pessino, 2012. "Social Spending and Income Redistribution in Argentina During the 2000s: the Rising Role of Noncontributory Pensions," Working Papers 1221, Tulane University, Department of Economics.
  7. John Scott, 2014. "Redistributive Impact and Efficiency of Mexico’s Fiscal System," Public Finance Review, SAGE Publishing, vol. 42(3), pages 368-390, May.
  8. Fabio Veras Soares & Sergei Soares & Marcelo Medeiros & Rafael Guerreiro Osório, 2006. "Programas de Transferência de Renda no Brasil: impactos sobre a desigualdade," Discussion Papers 1228, Instituto de Pesquisa Econômica Aplicada - IPEA.
  9. Immervoll, Herwig & Levy, Horacio & Nogueira, José Ricardo & O'Donoghue, Cathal & Siqueira, Rozane Bezerra de, 2006. "The Impact of Brazil's Tax-Benefit System on Inequality and Poverty," IZA Discussion Papers 2114, Institute for the Study of Labor (IZA).
  10. Sean Higgins & Claudiney Pereira, 2014. "The Effects of Brazil’s Taxation and Social Spending on the Distribution of Household Income," Public Finance Review, SAGE Publishing, vol. 42(3), pages 346-367, May.
  11. Alm, James & Bahl, Roy & Murray, Matthew N, 1990. "Tax Structure and Tax Compliance," The Review of Economics and Statistics, MIT Press, vol. 72(4), pages 603-13, November.
  12. Adriana Camacho & Emily Conover & Alejandro Hoyos, 2009. "Effects of Colombia's Social Protection System on Workers' Choice between Formal and Informal Employment," DOCUMENTOS CEDE 006003, UNIVERSIDAD DE LOS ANDES-CEDE.
  13. James J. Heckman, 2008. "Schools, Skills, and Synapses," Working Papers 200833, Geary Institute, University College Dublin.
  14. Daniel Aaronson & Bhashkar Mazumder, 2008. "Intergenerational Economic Mobility in the United States, 1940 to 2000," Journal of Human Resources, University of Wisconsin Press, vol. 43(1).
  15. François Bourguignon & Ferreira Francisco H. G. & Philippe G. Leite, 2008. "Beyond Oaxaca-Blinder: Accounting for differences in household income distributions," Post-Print halshs-00754283, HAL.
  16. Wallace, Sally & Wasylenko, Michael J. & Weiner, David, 1991. "The Distributional Implications of the 1986 Tax Reform," National Tax Journal, National Tax Association, vol. 44(2), pages 181-98, June.
  17. James Alm & Keith Finlay, 2013. "Who Benefits from Tax Evasion?," Economic Analysis and Policy, Elsevier, vol. 43(2), pages 139-154, September.
  18. Nada Eissa & Jeffrey B. Liebman, 1995. "Labor Supply Response to the Earned Income Tax Credit," NBER Working Papers 5158, National Bureau of Economic Research, Inc.
  19. Eduardo Lora & Johanna Fajardo, 2012. "Employment and Taxes in Latin America: An Empirical Study of the Effects of Payroll, Corporate Income and Value-Added Taxes on Labor Outcomes," IDB Publications (Working Papers) 76958, Inter-American Development Bank.
  20. Sean Higgins & Nora Lustig & Julio Ramirez & Billy Swanson, 2013. "Social Spending, Taxes and Income Redistribution in Paraguay," Working Papers 1311, Tulane University, Department of Economics.
  21. Brunori, Paolo & Ferreira, Francisco H. G. & Peragine, Vito, 2013. "Inequality of Opportunity, Income Inequality and Economic Mobility: Some International Comparisons," IZA Discussion Papers 7155, Institute for the Study of Labor (IZA).
  22. Robert D. Plotnick & Eugene Smolensky & Eirik Evenhouse & Siobhan Reilly, 1998. "Inequality, Poverty, and the Fisc in Twentieth-Century America," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 21(1), pages 51-75, October.
  23. Nora Lustig & Carola Pessino & John Scott, 2013. "The Impact of Taxes and Social Spending on Inequality and Poverty in Argentina, Bolivia, Brazil, Mexico, Peru and Uruguay: An Overview," Working Papers 1313, Tulane University, Department of Economics.
  24. Ferreira, Francisco H. G. & Leite, Phillippe G. & Litchfield, Julie A., 2006. "The rise and fall of Brazilian inequality, 1981-2004," Policy Research Working Paper Series 3867, The World Bank.
  25. David Card & Alan B. Krueger, 1991. "School Quality and Black-White Relative Earnings: A Direct Assessment," NBER Working Papers 3713, National Bureau of Economic Research, Inc.
  26. Nora Lustig, George Gray-Molina, Sean Higgins, Miguel Jaramillo, Wilson Jiménez, Veronica Paz, Claudiney Pereira, Carola Pessino, John Scott, and Ernesto Yañez, 2012. "The Impact of Taxes and Social Spending on Inequality and Poverty in Argentina, Bolivia, Brazil, Mexico, and Peru: A Synthesis of Results," Working Papers 311, Center for Global Development.
  27. Eduardo M.R.A. Engel & Alexander Galetovic & Claudio E. Raddatz, 1998. "Taxes and Income Distribution in Chile: Some Unpleasant Redistributive Arithmetic," NBER Working Papers 6828, National Bureau of Economic Research, Inc.
  28. Ricardo Paes de Barros & Francisco H.G. Ferreira & Jose R. Molinas Vega & Jaime Saavedra Chanduvi, 2009. "Measuring Inequality of Opportunities in Latin America and the Caribbean," World Bank Publications, The World Bank, number 2580, October.
  29. Francisco H.G. Ferreira & Julian Messina & Jamele Rigolini & Luis-Felipe López-Calva & Maria Ana Lugo & Renos Vakis, 2013. "Economic Mobility and the Rise of the Latin American Middle Class," World Bank Publications, The World Bank, number 11858, October.
  30. Tim Callan & Tim Smeeding & Panos Tsakloglou, 2008. "Short-run distributional effects of public education transfers to tertiary education students in seven European countries," Education Economics, Taylor & Francis Journals, vol. 16(3), pages 275-288.
  31. Medeiros, Marcelo & Souza, Pedro H.G.F., 2013. "The State and income inequality in Brazil," Institute for Research on Labor and Employment, Working Paper Series qt584222f0, Institute of Industrial Relations, UC Berkeley.
  32. Facundo Alvaredo & Leonardo Gasparini, 2013. "Recent Trends in Inequality and Poverty in Developing Countries," CEDLAS, Working Papers 0151, CEDLAS, Universidad Nacional de La Plata.
  33. repec:idb:brikps:60098 is not listed on IDEAS
  34. Salvatore Morelli & Timothy Smeeding & Jeffrey Thompson, 2014. "Post-1970 Trends in Within-Country Inequality and Poverty: Rich and Middle Income Countries," CSEF Working Papers 356, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy.
  35. Oliver Denk & Robert P. Hagemann & Patrick Lenain & Valentin Somma, 2013. "Inequality and Poverty in the United States: Public Policies for Inclusive Growth," OECD Economics Department Working Papers 1052, OECD Publishing.
  36. Nora Lustig & Florencia Amabile & Marisa Bucheli & George Gray Molina & Sean Higgins & Miguel Jaramillo & Wilson Jimenez Pozo & Veronica Paz Arauco & Claudiney Pereira & Carola Pessino & Maximo Rossi , 2013. "The Impact of Taxes and Social Spending on Inequality in Argentina, Bolivia, Brazil, Mexico, Peru and Uruguay: An Overview," Working Papers 1316, Tulane University, Department of Economics.
  37. Nicolas Pistolesi, 2009. "Inequality of opportunity in the land of opportunities, 1968–2001," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 7(4), pages 411-433, December.
  38. Nora Lustig & George Gray-Molina & Sean Higgins & Miguel Jaramillo & Wilson Jiménez & Veronica Paz & Claudiney Pereira & Carola Pessino & John Scott & Ernesto Yañez, 2012. "The impact of taxes and social spending on inequality and poverty in Argentina, Bolivia, Brazil, Mexico and Peru: a synthesis of results," Commitment to Equity (CEQ) Working Paper Series 1303, Tulane University, Department of Economics.
  39. Santiago Garganta & Leonardo Gasparini, 2012. "El Impacto de un Programa Social sobre la Informalidad Laboral: El Caso de la AUH en Argentina," CEDLAS, Working Papers 0133, CEDLAS, Universidad Nacional de La Plata.
  40. Nora Lustig & Sean Higgins, 2012. "Commitment to Equity Assessment (CEQ): Estimating the Incidence of Social Spending, Subsidies and Taxes Handbook," Working Papers 1219, Tulane University, Department of Economics.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:inq:inqwps:ecineq2013-316. 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: (Maria Ana Lugo)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.