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Commitment to Equity Assessment (CEQ): Estimating the Incidence of Social Spending, Subsidies and Taxes Handbook

Author

Listed:
  • Nora Lustig

    (Department of Economics, Tulane University)

  • Sean Higgins

    (Department of Economics, Tulane University)

Abstract

This handbook presents a step-by-step guide to applying the incidence analysis used in the multi-country project CEQ. We define the pre- and post-net transfers income concepts, discuss the methodological assumptions used to construct them, explain how taxes, subsidies and transfers should be allocated at the household level, and suggest what to do when the information on taxes and transfers is not included in the household survey. We also describe the indicators that are used to assess the distributive impact, progressivity and effectiveness of social spending, subsidies and taxes. In addition, we present sample Stata code for producing some of the indicators.

Suggested Citation

  • 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.
    • Handle: RePEc:tul:wpaper:1219
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    File URL: http://repec.tulane.edu/RePEc/pdf/tul1219.pdf
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    References listed on IDEAS

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    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.
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    5. Nora Lustig & Sean Higgins, 2012. "Fiscal Incidence, Fiscal Mobility and the Poor: A New Approach," Working Papers 1202, Tulane University, Department of Economics.
    6. Ivica Urban, 2009. "Kakwani decomposition of redistributive effect: Origins, critics and upgrades," Working Papers 148, ECINEQ, Society for the Study of Economic Inequality.
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    8. Galindo, Arturo & Scartascini, Carlos & Payne, J. Mark & Daughters, Robert & Melo, Alberto & Echebarría, Koldo & Lora, Eduardo & Filc, Gabriel & Micco, Alejandro & Chong, Alberto E. & Panizza, Ugo & B, 2007. "The State of State Reform in Latin America," IDB Publications (Books), Inter-American Development Bank, number 352, March.
    9. Jean-Yves Duclos & Abdelkrim Araar, 2006. "Poverty and Equity," Economic Studies in Inequality, Social Exclusion, and Well-Being, Springer, number 978-0-387-33318-2, Fall.
    10. Barr, Nicholas, 2004. "Economics of the Welfare State," OUP Catalogue, Oxford University Press, edition 4, number 9780199264971.
    11. Herwig Immervoll & Horacio Levy & José Ricardo Nogueira & Cathal O´Donoghue & Rozane Bezerra de Siqueira, 2005. "The Impact of Brazil´s Tax-Benefit System on Inequality and Poverty," Ibero America Institute for Econ. Research (IAI) Discussion Papers 117, Ibero-America Institute for Economic Research.
    12. Shaohua Chen & Martin Ravallion, 2010. "The Developing World is Poorer than We Thought, But No Less Successful in the Fight Against Poverty," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 125(4), pages 1577-1625.
    13. Ferreira , Francisco H.G. & Robalino, David, 2010. "Social protection in Latin America : achievements and limitations," Policy Research Working Paper Series 5305, The World Bank.
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    Cited by:

    1. Francisco G. Ferreira & Nora Lustig & Daniel Teles, 2015. "Appraising cross-national income inequality databases: An introduction," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 13(4), pages 497-526, December.
    2. Branko Milanovic & Sean Higgins & Nora Lustig & Whitney Ruble & Timothy M. Smeeding, 2016. "Comparing the Incidence of Taxes and Social Spending in Brazil and the United States," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 62, pages 22-46, August.
    3. Inchauste, Gabriela & Lustig, Nora & Maboshe, Mashekwa & Purfield, Catriona & Woolard, Ingrid, 2015. "The distributional impact of fiscal policy in South Africa," Policy Research Working Paper Series 7194, The World Bank.
    4. Florencia Amábile & Marisa Bucheli & Máximo Rossi, 2014. "Inequality and Poverty in Uruguay by Race: the Impact of Fiscal Policies," Commitment to Equity (CEQ) Working Paper Series 19, Tulane University, Department of Economics, revised Feb 2015.
    5. Nora Lustig & Carola Pessino, 2013. "Social spending and income redistribution in Argentina during the 2000s: The rising noncontributory pensions," Commitment to Equity (CEQ) Working Paper Series 1305, Tulane University, Department of Economics, revised Aug 2013.
    6. Cabrera, Maynor & Lustig, Nora & Morán, Hilcías E., 2015. "Fiscal Policy, Inequality, and the Ethnic Divide in Guatemala," World Development, Elsevier, vol. 76(C), pages 263-279.
    7. Jose Cuesta & Jon Jellema & Lucia Ferrone, 0. "Fiscal Policy, Multidimensional Poverty, and Equity in Uganda: A Child-Lens Analysis," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 0, pages 1-32.
    8. Jose Cuesta & Jon Jellema & Lucia Ferrone, 2021. "Fiscal Policy, Multidimensional Poverty, and Equity in Uganda: A Child-Lens Analysis," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 33(3), pages 427-458, June.
    9. Matěj Bajgar & Petr Janský, 2015. "Skutečná kupní síla v krajích České republiky: zohlednění regionální cenové hladiny a struktury pracovní síly [Purchasing Power in the Regions: Reflecting Price Levels and Employment Structures]," Politická ekonomie, Prague University of Economics and Business, vol. 2015(7), pages 860-876.
    10. Sean Higgins, Nora Lustig, Whitney Ruble, and Timothy Smeeding, 2014. "Comparing the Incidence of Taxes and Social Spending in Brazil and the United States - Working Paper 360," Working Papers 360, Center for Global Development.
    11. Nancy Birdsall & Christian J. Meyer, 2015. "The Median is the Message: A Good Enough Measure of Material Wellbeing and Shared Development Progress," Global Policy, London School of Economics and Political Science, vol. 6(4), pages 343-357, November.
    12. Nora Lustig & Florencia Amábile & Marisa Bucheli & George Gray Molina & Sean Higgins & Miguel Jaramillo & Wilson Jiménez Pozo & Veronica Paz Arauco & Claudiney Pereira & Carola Pessino & Máximo Rossi , 2013. "The impact of taxes and social spending on inequality and poverty in Argentina, Bolivia, Brazil, Mexico, Peru and Uruguay: An overview," Working Papers 315, ECINEQ, Society for the Study of Economic Inequality.
    13. Bussolo,Maurizio & Simone,Schotte & Matytsin,Mikhail, 2015. "Population aging and households? saving in the Russian Federation," Policy Research Working Paper Series 7443, The World Bank.
    14. Petr Janský & Klára Kalíšková & Daniel Münich, 2016. "Does the Czech Tax and Benefit System Contribute to One of Europe’s Lowest Levels of Relative Income Poverty and Inequality?," Eastern European Economics, Taylor & Francis Journals, vol. 54(3), pages 191-207, May.
    15. World Bank, "undated". "Social Gains in the Balance : A Fiscal Policy Challenge for Latin America and the Caribbean [Ganancias sociales en la balanza : un desafio de la politica fiscal para América Latina y el Caribe]," World Bank Publications - Reports 17198, The World Bank Group.
    16. Augusto de la Torre & Eduardo Levy Yeyati & Guillermo Beylis & Tatiana Didier & Carlos Rodriguez Castelan & Sergio Schmukler, "undated". "Inequality in a Lower Growth Latin America : LAC Semiannual Report, October 2014," World Bank Publications - Reports 20413, The World Bank Group.

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    More about this item

    Keywords

    handbook; taxes and transfers; fiscal incidence; poverty; inequality;
    All these keywords.

    JEL classification:

    • H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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