Measuring the benefit from reducing income inequality in terms of GDP

Arbeitspapier

Given that well-being is a concave function of income, inequality is inefficient from a utilitarian perspective. This paper proposes a way to express the utilitarian benefit from redistributive reforms in terms of out- put, i.e. as a share of GDP. Three applications are presented: First, in nine European countries under study, a mild increase in government redis- tribution allows for gains in well-being equivalent to 8.9%-20.2% of higher GDP, and 55.8% for the US. Second, in the US, redistributing income in excess of the level at the 99th percentile is as beneficial as a 39.5% GDP-increment. Third, revoking government redistribution in Germany reduces welfare by the same amount as a 25.4% decline in output.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: SFB 649 Discussion Paper ; No. 2016-008

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Personal Income, Wealth, and Their Distributions ; Equity, Justice, Inequality, and Other Normative Criteria and Measurement
• Thema: Income Distribution ; Inequality

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Voigts, Simon
• Ereignis: Veröffentlichung
• (wer): Humboldt University of Berlin, Collaborative Research Center 649 - Economic Risk
• (wo): Berlin
• (wann): 2016

Weitere Informationen

• Handle: http://hdl.handle.net/10419/146177
• Letzte Aktualisierung: 10.03.2025, 11:45 MEZ