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Explaining low redistributive impact in Bolivia

Author

Listed:
  • Verónica Paz Arauco

    (Instituto Alternativo)

  • George Gray Molina
  • Wilson Jiménez Pozo

    (Fundación Aru)

  • Ernesto Yáñez Aguilar

    (Instituto Alternativo)

Abstract

Despite an increase of social spending of about 3 percentage points with respect to GDP between 2007 and 2009, fiscal policy in Bolivia had a low redistributive impact. This paper analyzes the fiscal incidence of monetary and in-kind transfers, taxes and subsidies. The obstacles to further redistributive impact are significant leakages to the non-poor and the small size of the transfers. Fiscal incidence on poverty and income inequality could increase with better targeting to the poor, by increasing the size of the transfers and/or by making the existing tax system more progressive.

Suggested Citation

  • Verónica Paz Arauco & George Gray Molina & Wilson Jiménez Pozo & Ernesto Yáñez Aguilar, 2012. "Explaining low redistributive impact in Bolivia," Commitment to Equity (CEQ) Working Paper Series 06, Tulane University, Department of Economics, revised Apr 2013.
  • Handle: RePEc:tul:ceqwps:06
    as

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    File URL: http://repec.tulane.edu/RePEc/ceq/ceq06.pdf
    File Function: Revised version, 2013
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    References listed on IDEAS

    as
    1. Lustig, Nora & Gray Molina, George & Higgins, Sean & Jaramillo, Miguel & Jiménez, Wilson & Paz, Verónica & Pereira, Claudiney & Pessino, Carola & Scott, John & Yáñez, Ernesto, 2012. "The impact of taxes and social spending on inequality and poverty in Argentina, Bolivia, Brazil, Mexico and Peru: a synthesis of results," Research Department working papers 234, CAF Development Bank Of Latinamerica.
    2. Nora Lustig & Carola Pessino & George Gray Molina & Wilson Jimenez & Veronica Paz & Ernesto Yanez & Claudiney Pereira & Sean Higgins & John Scott & Miguel Jaramillo, 2011. "Fiscal Policy and Income Redistribution in Latin America: Challenging the Conventional Wisdom," Working Papers 1124, Tulane University, Department of Economics.
    3. Nora Lustig & Carola Pessino & John Scott, 2014. "The Impact of Taxes and Social Spending on Inequality and Poverty in Argentina, Bolivia, Brazil, Mexico, Peru, and Uruguay," Public Finance Review, , vol. 42(3), pages 287-303, May.
    4. John Scott, 2014. "Redistributive Impact and Efficiency of Mexico’s Fiscal System," Public Finance Review, , vol. 42(3), pages 368-390, May.
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    More about this item

    Keywords

    Bolivia; fiscal incidence; inequality; poverty; redistribution.;
    All these keywords.

    JEL classification:

    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • H5 - Public Economics - - National Government Expenditures and Related Policies

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