Mitigating the Gap Between the Rich and the Poor: Key Trends and Drivers of Redistribution
Abstract The growing inequality of market income has attracted considerable attention; less so the redistribution of income. This article analyses key trends and drivers of income redistribution in the EU and the world. It shows that in the EU increasing redistribution has largely stabilised the dis...
Saved in:
| Main Authors: | , |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
Sciendo
2020-07-01
|
| Series: | Intereconomics |
| Online Access: | https://doi.org/10.1007/s10272-020-0909-x |
| Tags: |
Add Tag
No Tags, Be the first to tag this record!
|
| _version_ | 1850236873155280896 |
|---|---|
| author | Martin Larch Philipp Mohl |
| author_facet | Martin Larch Philipp Mohl |
| author_sort | Martin Larch |
| collection | DOAJ |
| description | Abstract The growing inequality of market income has attracted considerable attention; less so the redistribution of income. This article analyses key trends and drivers of income redistribution in the EU and the world. It shows that in the EU increasing redistribution has largely stabilised the dispersion of disposable income since the late 1990s. Only some advanced countries with a dominant free market ideology have recorded an increasing inequality of disposable income alongside a growing inequality of market outcomes. The evidence from panel data shows that the degree of redistribution increases with per capita income and with the share of low-tech, low-income sectors in manufacturing as well as, in line with the median voter model, when more than half of the voters earn less than the average income in countries with a majoritarian electoral system. More redistribution is associated with lower budgetary surpluses or higher deficits. |
| format | Article |
| id | doaj-art-2f1313ecfd63443b9648e80641e438dc |
| institution | OA Journals |
| issn | 0020-5346 1613-964X |
| language | English |
| publishDate | 2020-07-01 |
| publisher | Sciendo |
| record_format | Article |
| series | Intereconomics |
| spelling | doaj-art-2f1313ecfd63443b9648e80641e438dc2025-08-20T02:01:53ZengSciendoIntereconomics0020-53461613-964X2020-07-0155424525510.1007/s10272-020-0909-xMitigating the Gap Between the Rich and the Poor: Key Trends and Drivers of RedistributionMartin Larch0Philipp Mohl1Secretariat of the European Fiscal Board, BERL 2/352, European CommissionDG Economic and Financial Affairs, European CommissionAbstract The growing inequality of market income has attracted considerable attention; less so the redistribution of income. This article analyses key trends and drivers of income redistribution in the EU and the world. It shows that in the EU increasing redistribution has largely stabilised the dispersion of disposable income since the late 1990s. Only some advanced countries with a dominant free market ideology have recorded an increasing inequality of disposable income alongside a growing inequality of market outcomes. The evidence from panel data shows that the degree of redistribution increases with per capita income and with the share of low-tech, low-income sectors in manufacturing as well as, in line with the median voter model, when more than half of the voters earn less than the average income in countries with a majoritarian electoral system. More redistribution is associated with lower budgetary surpluses or higher deficits.https://doi.org/10.1007/s10272-020-0909-x |
| spellingShingle | Martin Larch Philipp Mohl Mitigating the Gap Between the Rich and the Poor: Key Trends and Drivers of Redistribution Intereconomics |
| title | Mitigating the Gap Between the Rich and the Poor: Key Trends and Drivers of Redistribution |
| title_full | Mitigating the Gap Between the Rich and the Poor: Key Trends and Drivers of Redistribution |
| title_fullStr | Mitigating the Gap Between the Rich and the Poor: Key Trends and Drivers of Redistribution |
| title_full_unstemmed | Mitigating the Gap Between the Rich and the Poor: Key Trends and Drivers of Redistribution |
| title_short | Mitigating the Gap Between the Rich and the Poor: Key Trends and Drivers of Redistribution |
| title_sort | mitigating the gap between the rich and the poor key trends and drivers of redistribution |
| url | https://doi.org/10.1007/s10272-020-0909-x |
| work_keys_str_mv | AT martinlarch mitigatingthegapbetweentherichandthepoorkeytrendsanddriversofredistribution AT philippmohl mitigatingthegapbetweentherichandthepoorkeytrendsanddriversofredistribution |