Pro-Poor Tax Reforms, with an Application to Mexico

Jean-Yves Duclos, Paul Makdissi () and Abdelkrim Araar

No 4511, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper proposes a methodology for testing for whether tax reforms are pro-poor. This is done by extending stochastic dominance techniques to help identify tax reforms that will necessarily be deemed absolutely or relatively pro-poor by a wide spectrum of poverty analysts. The statistical properties of the various estimators are also derived in order to make the method implementable using survey data. The methodology is used to assess the pro-poorness of possible reforms to Mexico's indirect tax system. This leads to the identification of several possible pro-poor tax reforms in that country. It also shows how the pro-poorness of a tax reform depends on one's conception of poverty as well as on the revenue and efficiency impact of the reform.

Keywords: stochastic dominance; tax reforms; pro-poor changes; Mexico (search for similar items in EconPapers)
JEL-codes: D12 D63 H21 I32 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2009-10
New Economics Papers: this item is included in nep-dev and nep-pbe
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Published - published as 'Pro-Poor Indirect Tax Reforms, with an Application to Mexico' in: International Tax and Public Finance, 2014, 21(1), 87-118

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Related works:
Working Paper: Pro-Poor Tax Reforms, with an Application to Mexico (2010)
Working Paper: Pro-Poor Tax reforms, with an Application to Mexico (2009)
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