Income Redistribution and Social Policy: A Set of Studies

Income Redistribution and Social Policy: A Set of Studies

Income Redistribution and Social Policy: A Set of Studies

Income Redistribution and Social Policy: A Set of Studies

Excerpt

The main purpose of this set of studies is to investigate the nature and the magnitude of the redistribution of incomes brought about by social policies and to examine some of the likely consequences of this redistribution. With the exception of the two first studies, which discuss some of the applications of modern economic analysis to the process and forms of income redistribution, the emphasis is on the problem of measurement. I have thought it useful, therefore, before telling the reader something of the practical difficulties we have had to face in the compilation of the studies, to make some reference to the general questions regarding the definition of redistribution, the problems involved in its measurement and the reasons why we attempt to measure its magnitude.

II

The term 'redistribution' is used in a very broad sense to describe a situation in which the state alters the distribution of incomes in a given community by fiscal and non-fiscal means. It implies, therefore, comparison with a situation which would exist were there no such alteration. While the term is generally used to describe investigations relating to income ranges, it can equally well be applied to alterations affecting social classes, different age groups and so on.

In this broad sense, however, the term is rather misleading. It suggests that there is something exclusive about the way in which some organization, the state, affects the distribution of incomes as compared with other ways in which 'gains' and 'losses' can occur in a given community. The distribution of income over any period will depend on the power and the motives of different types of economic unit. These units are broadly classified in various ways; for instance into 'capital' and 'labour' with appro-

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