Measuring Progressivity and Inequality

Jean-Yves Duclos

Cahiers de recherche from Université Laval - Département d'économique

Abstract: A general class of progressivity indices is proposed which is consistent with the well-developed theory of the measurement of inequality and social welfare. In particular, we show that the more progressive a tax system, the more equal the distribution of net income and the greater the progressivity index. For an additive social welfare function and a progressive tax system, the greater the degree of relative inequality aversion, the greater the progressivity index. We also discuss the link between inequality of gross income and tax progressivity. A by-product is the derivation of a general class of inequality measures that are invariant to equi-proportionate changes in incomes. We illustrate the analysis using the British tax and benefit system.

Keywords: Progressivity; redistribution; inequality; social welfare (search for similar items in EconPapers)
JEL-codes: D31 D63 H23 (search for similar items in EconPapers)
Date: 1995
New Economics Papers: this item is included in nep-pub
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Related works:
Working Paper: Measuring Progressivity and Inequality (1995)
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Persistent link: https://EconPapers.repec.org/RePEc:lvl:laeccr:9525

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