Affiliation:
1. Institute for Fiscal Studies
Abstract
AbstractWe study earnings and income inequality in Britain over the 25 years prior to the COVID‐19 pandemic. We focus on the middle 90 per cent of the income distribution, within which the gap between top and bottom in 2019–20 was essentially the same, after taxes and transfers, as a quarter‐century earlier. This has led to a narrative of ‘stable inequality’, which we argue misses important nuances and key lessons from the UK's experience. In particular, there have been periods in which household earnings inequalities were changing considerably but tax and transfer policy was offsetting its effects on income inequality – in different directions at different times, reflecting sharp changes of policy approach. Means‐tested transfers played a crucial role in containing inequality during the ‘inclusive growth’ period of the 1990s and early 2000s, as well as the Great Recession. During the 2010s, the minimum wage emerged as the government's primary policy tool for boosting incomes, but this happened almost simultaneously with cutbacks to means‐tested transfers, meaning that household earnings inequalities fell considerably and yet net income inequality rose.
Subject
Economics and Econometrics,Finance,Accounting
Reference64 articles.
1. Advani A. Koenig F. Pessina L.&Summers A.(2020) Importing inequality: immigration and the top 1%. CAGE Working Paper 508 https://warwick.ac.uk/fac/soc/economics/research/centres/cage/manage/publications/wp508.2020.pdf.
2. Advani A.&Summers A.(2020) Capital gains and UK inequality.CAGE Working Paper 465 https://warwick.ac.uk/fac/soc/economics/research/centres/cage/manage/publications/wp465.2020.pdf.
3. Has Consumption Inequality Mirrored Income Inequality?
4. Almeida V. Barrios S. Christl M. De Poli S. Tumino A.&Van Der Wielen W.(2020) Households’ income and the cushioning effect of fiscal policy measures during the Great Lockdown. JRC Working Paper on Taxation & Structural Reforms 2020‐06 Joint Research Centre (Seville site).
5. Andrew A. Bandiera O. Costa Dias M.&Landais C.(2021) Women and men at work. IFS Deaton Review of Inequalities https://ifs.org.uk/inequality/women‐and‐men‐at‐work/.
Cited by
3 articles.
订阅此论文施引文献
订阅此论文施引文献,注册后可以免费订阅5篇论文的施引文献,订阅后可以查看论文全部施引文献