Predistribution versus Redistribution: Evidence from France and the United States
American Economic Journal: Applied Economics
vol. 16,
no. 2, April 2024
(pp. 31-65)
Abstract
We construct series of posttax income for France over the 1900–2018 period and compare them with US series. We quantify the extent of redistribution—the reduction from pretax to posttax inequality—and estimate the contribution of redistribution in explaining differences in posttax inequality. We find that differences in pretax inequality drive most of the differences in posttax inequality between France and the United States, and that changes over time in both countries are mostly due to changes in pretax inequality. We highlight that the concept of redistribution can be empirically misleading for judging how policies reduce inequalities.Citation
Bozio, Antoine, Bertrand Garbinti, Jonathan Goupille-Lebret, Malka Guillot, and Thomas Piketty. 2024. "Predistribution versus Redistribution: Evidence from France and the United States." American Economic Journal: Applied Economics, 16 (2): 31-65. DOI: 10.1257/app.20220023Additional Materials
JEL Classification
- D31 Personal Income, Wealth, and Their Distributions
- H23 Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies
- H24 Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes
- H31 Fiscal Policies and Behavior of Economic Agents: Household
- I38 Welfare, Well-Being, and Poverty: Government Programs; Provision and Effects of Welfare Programs
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