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A large scale OLG model for France, Italy and Sweden: assessing the interpersonal and intrapersonal redistributive effects of public policies

Author

Listed:
  • Alessandro Bucciol

    () (Department of Economics (University of Verona))

  • Laura Cavalli

    () (Department of Economics (University of Verona))

  • Igor Fedotenkov

    () (Department of Economics (University of Verona))

  • Paolo Pertile

    () (Department of Economics (University of Verona))

  • Veronica Polin

    () (Department of Economics (University of Verona))

  • Nicola Sartor

    () (Department of Economics (University of Verona))

  • Alessandro Sommacal

    () (Department of Economics (University of Verona))

Abstract

The paper presents a large scale overlapping generation model with heterogeneous agents, where the family is the decision unit. We model a large number of tax and public expenditure (cash and in kind) programmes, so that the equity and efficiency implications of public sector intervention may be assessed in its complexity. We do this for three european countries that show remarkable differences in the design of most of these programmes: France, Italy and Sweden. We show that the model is able to match relevant aggregate and distributional statistics of the three countries we analyse. To illustrate the working of the model, we provide examples of policy experiments that can be simulated. That is, we compare our model economies featuring the current set of public policies implemented in France, Italy and Sweden, with alternative economies where some (all) public finance programs are absent. The comparison is done, looking at the effects on both inequality and individual welfare.

Suggested Citation

  • Alessandro Bucciol & Laura Cavalli & Igor Fedotenkov & Paolo Pertile & Veronica Polin & Nicola Sartor & Alessandro Sommacal, 2014. "A large scale OLG model for France, Italy and Sweden: assessing the interpersonal and intrapersonal redistributive effects of public policies," Working Papers 07/2014, University of Verona, Department of Economics.
  • Handle: RePEc:ver:wpaper:07/2014
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    References listed on IDEAS

    as
    1. Polin, Veronica & Sartor, Nicola, 2009. "Family Intertemporal Fiscal Incidence: A new Methodology for Assessing Public Policies," MPRA Paper 25570, University Library of Munich, Germany.
    2. Apps,Patricia & Rees,Ray, 2009. "Public Economics and the Household," Cambridge Books, Cambridge University Press, number 9780521716284, October.
    3. 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.
    4. Fehr, Hans & Kallweit, Manuel & Kindermann, Fabian, 2017. "Families and social security," European Economic Review, Elsevier, vol. 91(C), pages 30-56.
    5. Igor Fedotenkov, 2013. "A bootstrap method to test for the existence of finite moments," Journal of Nonparametric Statistics, Taylor & Francis Journals, vol. 25(2), pages 315-322, June.
    6. Albert Ando & Sergio Nicoletti-Altimari, 2004. "A micro simulation model of demographic development and households' economic behavior in Italy," Temi di discussione (Economic working papers) 533, Bank of Italy, Economic Research and International Relations Area.
    7. Fehr, Hans & Kallweit, Manuel & Kindermann, Fabian, 2013. "Should pensions be progressive?," European Economic Review, Elsevier, vol. 63(C), pages 94-116.
    8. R. Cont, 2001. "Empirical properties of asset returns: stylized facts and statistical issues," Quantitative Finance, Taylor & Francis Journals, vol. 1(2), pages 223-236.
    9. Imrohoroglu, Ayse & Imrohoroglu, Selahattin & Joines, Douglas H, 1995. "A Life Cycle Analysis of Social Security," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 6(1), pages 83-114, June.
    10. Rebecca Cassells & Ann Harding & Simon Kelly, 2006. "Problems and Prospects for Dynamic Microsimulation: A review and lessons for APPSIM," NATSEM Working Paper Series 63, University of Canberra, National Centre for Social and Economic Modelling.
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    More about this item

    Keywords

    Redistribution; Fiscal policy; Computable OLG models;

    JEL classification:

    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents

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