Redistribution of Income
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Income redistribution - Wikipedia, the free encyclopedia
Income redistribution refers to a political policy intended to even the amount ... The basic premise of the redistribution of income is that money should be ...
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Income redistribution - Conservapedia
Income redistribution can be either the act of an individual's voluntary ... Taxation and Income Redistribution: An Unsympathetic Critique of Practice and ...
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Redistribution of wealth - Wikipedia, the free encyclopedia
Republicans say that having a progressive income tax on the wealthy is unfair, ... Income redistribution. Socialism [edit] References ...
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income redistribution: Definition from Answers.com
Income Redistribution Way of spending personal income among various classes in society. ... An income redistribution program, for example, could take from the ...
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Americans Oppose Income Redistribution to Fix Economy
Americans prefer that the government focus on improving the economy as opposed to redistributing wealth, by 84% to ... income and wealth redistribution aspects ...
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Timberjay Newspapers Online
Obama's proposal amounts to income redistribution, which is a cardinal sin to ... Income redistribution was directly responsible for the building of much of this ...
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academics.vmi.edu/econ/fd/PF-Ch7.ppt
In the case of income redistribution to the poor, the number of recipients are ... Income redistribution can be a Pareto improvement in this case. ...
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Income Redistribution from Social Security
... "progressivity," that is, the redistribution of income from rich. to poor. ... 2 INCOME REDISTRIBUTION FROM SOCIAL SECURITY. assumptions may not be appropriate. ...
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Economist's View: Income Distribution
Equitable and Efficient Redistribution ... Redistribution of Opportunity ... are simply missing the real issue by going on and on about income redistribution? ...
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Income redistribution refers to a political policy intended to even the amount of income individuals are permitted to earn. This differs slightly from wealth redistribution or property redistribution, a policy which takes assets from the current owners and gives them to other individuals or groups. The basic premise of the redistribution of income is that money should be distributed to benefit the poorer members of society, and that the rich should be obliged to assist the poor. Thus, money should be redistributed from the rich to the poor, creating a more financially egalitarianism society. Proponents of redistribution often claim that the rich exploitation the poor or otherwise gain unfair benefits. Therefore, redistributive practices are justified in order to redress the balance. Critics deride it as "theft, put to a vote". "The ambitious politician naturally favors increased government...because of its enormous possibilities for patronage, for 'buying votes,' and for perpetuating a political administration through the economic dependence of constituents...," Two-Factor Theory: The Economics of Reality, (New York: Vintage Books, Random House, Inc., 1967), pp. 18-24.

Today, income redistribution occurs in some form in most democracy countries, most commonly through income-adjusted taxes (in which the amount of tax paid is directly connected to one's income), some of which goes to fund welfare (financial aid) programs to assist the poor.

Different Views on Redistribition Arguments for Redistribution Proponents of income redistribution may point to the fact that capitalism results in an unequal wealth distribution; for example the three richest people in the world possess more financial assets than the poorest 10% of the world's population (that is, the poorest 600 million people) combined. They also argue that economic inequality contributes to crime. There is also the issue of equal opportunity, for example in the case of providing education or health care for children, who are unable to pay for such services themselves, and are not responsible for their parents' income. Also the law of diminishing returns is cited, with the interpretation that the loss to the wealthy in the form of taxation is proportionately less than the gain to the poor from social programs. Adam Smith wrote that the cost of government must be borne by those best able to afford it. Finally, it is argued that the rich should pay higher taxes because they receive greater benefits from the protection of the government; they have more property, and therefore more assets for the government to defend. According to a recent survey of 1,000 American Economist, the majority favored income redistribution.

Arguments against Redistribution In the view of opponents to redistribution, the above arguments often overlook the standard of living, which historically rises dramatically with lesser redistribution, while at the same time increasing unequal results. This is due to wealth#The creation of wealth which benefits all areas of society, albeit in a more unequal proportion.

Public choice theory states that redistribution tends to benefit those with political clout to set spending priorities more than those in need, who lack real influence on government.Plotnick, Robert (1986) "An Interest Group Model of Direct Income Redistribution", The Review of Economics and Statistics, vol. 68, #4, pp. 594-602. Opponents of this theory argue that it punishes good economic activity whilst rewarding poor economic activity, resulting in an inefficient economy, and that it infringes on one's right to enjoy the fruit of one's labor and property rights. Milton Friedman famously argued that the slogan "From each according to his ability, to each according to his need" turns ability into a liability and need into an asset. Critics also argue that such measures will result in a brain drain and lead to a state where the middle class have to support a large population of unemployed and working poor with an ever-increasing percentage of their income. They also believe that income redistribution creates a dependency culture and a society that is not meritocratic.

There are numerous example of wealthy individuals and companies leaving a country (and moving their wealth) to others with a less punishing tax system. Thus an argument against redistribution is that the wealthy are far more likely to create wealth, jobs and employment and therefore taxation policy should entice them to remain.

Individualism and libertarianism ethics arguments consider "redistribution" a euphemism for theft, note that it infringes on one's right to enjoy the fruit of one's labor, that concepts such as "fair" and "deserve" are arbitrary excuses for plunder, and that stealing is still stealing regardless of what any group of non-Ownership may succeed in obtaining via government intermediary, and that consequently redistribution of legitimately obtained property cannot ever be justice. "Redistribution" as Euphemism or, Who Owns What? Philosophy Pathways, Number 65, 24 August 2003, by Anthony Flood

Choosing the Intensity of Redistribution Between total rejection of income redistribution and total support for income redistribution, modern societies chose a third way: They decide on the grade of redistribution. Rather using ethics, the decisions are made by letting different interests compete against each other in democratic elections. The objective of a moderated income redistribution is to avoid the unjust equalization of incomes on one side and unjust extremes of concentration on the other sides. Both forms of extreme redistribution tend to be implemented violently. Moderated redistributions then allow for a moderated income inequality which fosters a non-violent competition in free markets.

Measurement There are several ways to measure the redistribution of incomes. As an example, Progressive tax are a widely used method of income redistribution. Die difference between the Gini index for an income distribution before taxation and the Gini index after taxation is an indicator for the effects of such a taxation. Other inequality measures Small calculus of inequality measures and on-line calculator can be used as well.

See also

• Progressive taxation
• Robin Hood effect
• Redistribution
• Sabbath economics
• Social equality
• Welfare (financial aid)

Footnotes

Income redistribution - Wikipedia, the free encyclopedia
Income redistribution refers to a political policy intended to even the amount of income individuals are permitted to earn. [citation needed] The basic premise of the ...

The poverty trade-off: work incentives and income redistribution in ...
This study explores the tensions between policies to help people on low incomes by providing them with financial support directly and encouraging them to earn more.

JR190 The poverty trade-off
... Executive summary The poverty trade-off Work incentives and income redistribution in Britain Stuart Adam, Mike Brewer and Andrew Shephard

Income Redistribution - Conservapedia
Income redistribution can be either the act of an individual's voluntary charitable giving or government mandated compulsory transfer of assets and income from one group of ...

Income Redistribution And the Realignment Of American Politics

Work incentives and income redistribution
Work incentives and income redistribution . Stuart Adam. Mike Brewer. Andrew Shephard

Income redistribution in money and in kind - LSE Research Online
Income redistribution in money and in kind. Foldes, Lucien (1967) Income redistribution in money and in kind. Econometrica, 133 (34). pp. 30-41.

The effect of direct democracy on income redistribution: evidence for ...
There is an intensive dispute in political economics about the impact of institutions on income redistribution. While the main focus is on comparison between different forms of ...

National Statistics Online
Income inequality increased over the period 2004/05 to 2006/07. This was due to increased inequality of original income, primarily wages and salaries, as well as slower growth in ...

Income redistribution is not enough: income inequality, social welfare ...
Income redistribution is not enough: income inequality, social welfare programs, and achieving equity in health Barbara Starfield 1, Anne-Emanuelle Birn 2