IDEAS home Printed from https://ideas.repec.org/p/mil/wpdepa/2007-13.html
   My bibliography  Save this paper

On the Aronson-Johnson-Lambert decomposition of the redistributive effect

Author

Listed:
  • Achille VERNIZZI

    ()

  • Simone PELLEGRINO

    ()

Abstract

Recently van De Van, Creedy and Lambert (2001) and Lambert and Urban (2005) have reconsidered the original Aronson, Johnson and Lambert (1994) decomposition of the redistributive effect in order to properly evaluate personal income tax reforms, when sequential income groups do not concern exact equals. Lambert and Urban (2005) decompose the Atkinson-Plotnick-Kakwani index into three terms. We utilize this decomposition in choosing the optimal bandwidth and suggest to consider not only the highest vertical contribution to the redistributive effect, but also the horizontal inequity due to the reranking of the mean post-tax income among groups. Findings are applied to Italian data with respect to both individual nominal incomes and equivalent household incomes

Suggested Citation

  • Achille VERNIZZI & Simone PELLEGRINO, 2007. "On the Aronson-Johnson-Lambert decomposition of the redistributive effect," Departmental Working Papers 2007-13, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano, revised 26 Jun 2007.
  • Handle: RePEc:mil:wpdepa:2007-13
    as

    Download full text from publisher

    File URL: http://wp.demm.unimi.it/files/wp/2007/DEMM-2007_013wp.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Simone Pellegrino, 2007. "Struttura ed effetti redistributivi dell'imposta personale italiana: il confronto 2000-2005 e un esercizio di modifica," ECONOMIA PUBBLICA, FrancoAngeli Editore, vol. 2007(1-2), pages 99-144.
    2. Achille Vernizzi, 2007. "Una precisazione sulla scomposizione dell'indice di redistribuzione RE di Aronson-Johnson-Lambert e una proposta di estensione dell'indice di Plotnick," ECONOMIA PUBBLICA, FrancoAngeli Editore, vol. 2007(1-2), pages 145-154.
    3. van de Ven, Justin & Creedy, John & Lambert, Peter J, 2001. " Close Equals and Calculation of the Vertical, Horizontal and Reranking Effects of Taxation," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 63(3), pages 381-394, July.
    4. Dagum, Camilo, 1997. "A New Approach to the Decomposition of the Gini Income Inequality Ratio," Empirical Economics, Springer, vol. 22(4), pages 515-531.
    5. Ebert, Udo & Moyes, Patrick, 2000. "Consistent Income Tax Structures When Households Are Heterogeneous," Journal of Economic Theory, Elsevier, vol. 90(1), pages 116-150, January.
    6. Aronson, J Richard & Johnson, Paul & Lambert, Peter J, 1994. "Redistributive Effects and Unequal Income Tax Treatment," Economic Journal, Royal Economic Society, vol. 104(423), pages 262-270, March.
    7. Lambert, Peter J & Aronson, J Richard, 1993. "Inequality Decomposition Analysis and the Gini Coefficient Revisited," Economic Journal, Royal Economic Society, vol. 103(420), pages 1221-1227, September.
    8. Ivica Urban & Peter J. Lambert, 2008. "Redistribution, Horizontal Inequity, and Reranking: How to Measure Them Properly," Public Finance Review, , vol. 36(5), pages 563-587, September.
    9. Peter Lambert & Xavier Ramos, 1997. "Horizontal Inequity and Vertical Redistribution," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 4(1), pages 25-37, January.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Personal Income Tax; Redistributive Effect; Horizontal Inequity; Reranking;

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mil:wpdepa:2007-13. 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: (DEMM Working Papers). General contact details of provider: http://edirc.repec.org/data/damilit.html .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.