Political preferences for redistribution in Sweden

Spencer Bastani and Jacob Lundberg

The Journal of Economic Inequality, 2017, vol. 15, issue 4, No 4, 345-367

Abstract: Abstract We examine preferences for redistribution inherent in Swedish tax policy during 1971–2012 using the inverse optimal tax approach. The income distribution is carefully characterized with the help of administrative register data, and we employ behavioral elasticities reflecting the perceived distortionary effects of taxation. The revealed social welfare weights are high for non-workers, small for low-income earners, and hump-shaped around the median. At the top, they are always negative, especially so during the high-tax years of the 1970s and ’80s. The weights on non-workers increased sharply in the 1970s, fell drastically in the late ’80s and early ’90s, and have since then increased.

Keywords: Redistribution; Social welfare weights; Optimal taxation; Inverse optimal taxation; Social preferences (search for similar items in EconPapers)
Date: 2017
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Journal Article: Political preferences for redistribution in Sweden (2017)
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Working Paper: Political preferences for redistribution in Sweden (2016)
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DOI: 10.1007/s10888-017-9368-4

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