Inequality and Fiscal Policy [excerpt]

Publication cover

 

 
Excerpt
Series: Books
Author(s): Benedict Clements, Ruud Mooij, Sanjeev Gupta, and Michael Keen
Publisher: INTERNATIONAL MONETARY FUND
Published Date: September 2015
DOI: http://dx.doi.org/10.5089/9781513567754.071
ISBN: 9781513567754
This book analyzes fiscal policy and its link with inequality. Fiscal policy is the government's most powerful tool for addressing inequality. It affects households ‘consumption directly (through taxes and transfers) and indirectly (via incentives for work and production and the provision of public goods and individual services such as education and health). An important message of the book is that growth and equity are not necessarily at odds; with the appropriate mix of policy instruments and careful policy design, countries can in many cases achieve better distributional outcomes and improve economic efficiency. Country studies (on the Netherlands, China, India, Republic of Congo, and Brazil) demonstrate the diversity of challenges across countries and their differing capacity to use fiscal policy for redistribution. The analysis presented in the book builds on and extends work done at the IMF, and also includes contributions from leading academics.

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