David Rivera Gonzales

(BxSE)

‘What goes down must come up?’: Eliciting the role of tax-benefit policies in reducing poverty and inequality over two decades

Abstract: Standard inequality studies focus on tracking market income, blurring the role of tax-benefit systems. This paper quantifies how tax-benefit reforms shaped poverty and inequality in six Latin American countries: Argentina, Bolivia, Brazil, Colombia, Ecuador, and Peru over two decades. We combine harmonized household surveys with microsimulation models to construct counterfactual income distributions and apply a decomposition method to isolate the pure policy effect of taxes and transfers from changes in market incomes, demographics, and nominal uprating. We examine heterogeneity across countries and across economic cycles. We elicit differential paths following the notable first expansion, mid-2010s stagnation, and the 2020 COVID shock, assessing the roles of progressive taxation, expanded social protection, and automatic stabilizers. This study delivers comparable, policy-relevant evidence on which fiscal reforms most effectively reduced poverty and inequality in the region, informing debates on fiscal space, inclusive growth, and resilience to shocks in developing economies.

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*horaire déplacé à 12h30 ! *

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