Inequality, Mobility and Redistributive Taxation in a Finance-constrained Economy
Ryo Arawatari and
Tetsuo Ono
No 09-28, Discussion Papers in Economics and Business from Osaka University, Graduate School of Economics
Abstract:
This paper presents a simple model that displays a joint determination of income inequality and intergenerational mobility affected by redistributive taxation. The model shows that a larger redistribution improves equality and utility and enhances mobility when the poor are financially constrained, however it creates a trade-off between the rich and the poor in terms of utility when the poor are financially unconstrained. The model also shows that the size of the redistribution as well as wage inequality play key roles in explaining the cross-country differences in inequality and mobility among OECD countries.
Keywords: inequality; Gini coefficient; intergenerational mobility; redistributive taxation; financial constraints. (search for similar items in EconPapers)
JEL-codes: D31 H23 O23 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2009-09
New Economics Papers: this item is included in nep-dge and nep-pub
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http://www2.econ.osaka-u.ac.jp/library/global/dp/0928.pdf (application/pdf)
Related works:
Journal Article: Inequality, Mobility and Redistributive Taxation in a Finance-Constrained Economy (2015) 
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Persistent link: https://EconPapers.repec.org/RePEc:osk:wpaper:0928
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