 Incomes, incentives and the growth of means-testing in HungaryFiscal Studies, 1999, vol. 20, issue 1, 77-99 Abstract: The purpose of this paper is to examine the reform of family benefits and the growth of means-testing in Hungary. From 1996, many family benefits were means-tested for the first time. A new microsimulation model for Hungary, running on recent survey microdata, is used to simulate the impact of the 1996 reforms on government expenditures, the distribution of incomes, the targeting of benefits and effective marginal tax rates. These reforms are found to be largely benign and even progressive, but they also appear to be paving the way for the further extension of means-testing. The model is used to investigate such an extension by simulating the impact of a UK-style system of means-tested family benefits in Hungary. This system achieves some expenditure savings and better targeting of benefits, but also greatly increases effective marginal tax rates on low-income households with children. The paper argues that resulting poverty traps may increase child poverty in Hungary in the longer term and cautions against the overextension of means-testing. JEL-codes: H55 I38 P35 (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:ifs:fistud:v:20:y:1999:i:1:p:77-99 Ordering information: This journal article can be ordered from Access Statistics for this article More articles in Fiscal Studies from Institute for Fiscal Studies The Institute for Fiscal Studies 7 Ridgmount Street LONDON WC1E 7AE. Contact information at EDIRC. |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.