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Predistribution vs. Redistribution:Evidence from France and the U.S

Author

Listed:
  • Antoine Bozio

    (PSE, EHESS)

  • Bertrand Garbinti

    (CREST-ENSAE-IP Paris, WIL)

  • Jonathan Goupille-Lebret

    (Univ Lyon, CNRS, GATE UMR 5824, F-69342 Lyon, France, and ENS de Lyon)

  • Malka Guillot

    (HEC Liège, IPP, WIL)

  • Thomas Piketty

    (PSE, EHESS)

Abstract
We construct series of post-tax income for France over the 1900-2018 period and compare them with U.S. series. We quantify the extent of redistribution and estimate the impact of redistribution vs pretax inequality on post-tax inequality. We obtain three major findings. First, redistribution has increased in both countries to reach similar levels today. Second, the long-run decline in post-tax inequality in France is due mostly to the fall in pretax inequality. Third, the relative lower post-tax inequality in France is entirely explained by differences in pretax inequality. This suggests that more attention should be paid to policies affecting pretax inequality.

Suggested Citation

  • Antoine Bozio & Bertrand Garbinti & Jonathan Goupille-Lebret & Malka Guillot & Thomas Piketty, 2022. "Predistribution vs. Redistribution:Evidence from France and the U.S," Working Papers 2209, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
    • Handle: RePEc:gat:wpaper:2209
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    Cited by:

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    3. Bruno Bises & Francesco Bloise & Antonio ScialÃ, 2021. "Functional income distribution, inequality and the effectiveness of fiscal redistribution: evidence from OECD countries," Public Finance Research Papers 49, Istituto di Economia e Finanza, DSGE, Sapienza University of Rome.
    4. Carole Bonnet & Bertrand Garbinti & Anne Solaz, 2022. "Does Part-Time Mothering Help Get a Job? The Role of Shared Custody in Women’s Employment," European Journal of Population, Springer;European Association for Population Studies, vol. 38(5), pages 885-913, December.
    5. De Rosa, Mauricio & Flores, Ignacio & Morgan, Marc, 2024. "More unequal or not as rich? Revisiting the Latin American exception," World Development, Elsevier, vol. 184(C).
    6. Huet-Vaughn, Emiliano, 2023. "Minimum Wages and Voting: Assessing the Political Returns to Redistribution outside the Tax System," IZA Discussion Papers 16416, Institute of Labor Economics (IZA).
    7. Thomas Piketty & Emmanuel Saez & Gabriel Zucman, 2022. "Twenty Years and Counting: Thoughts about Measuring the Upper Tail," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 20(1), pages 255-264, March.
    8. Ilyana Kuziemko & Nicolas Longuet-Marx & Suresh Naidu, 2024. "“Compensate the Losers?†Economic Policy and Partisan Realignment in the US," Working Papers 321, Princeton University, Department of Economics, Center for Economic Policy Studies..
    9. Bruno Bises & Francesco Bloise & Antonio Scialà, 2024. "Labor share as an "automatic stabilizer" of income inequality," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 31(2), pages 511-532, April.
    10. François, Martin & Mertens de Wilmars, Sybille & Maréchal, Kevin, 2023. "Unlocking the potential of income and wealth caps in post-growth transformation: A framework for improving policy design," Ecological Economics, Elsevier, vol. 208(C).

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    More about this item

    Keywords

    inequality; redistribution; predistribution; taxes; transfers;
    All these keywords.

    JEL classification:

    • D3 - Microeconomics - - Distribution
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
    • H5 - Public Economics - - National Government Expenditures and Related Policies

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