Measuring the redistributive impact of taxes and transfers in the presence of reranking
This paper provides a theoretical foundation for analyzing the redistributive effect of taxes and transfers for the case in which the ranking of individuals by pre-fiscal income changes as a result of fiscal redistribution. Through various examples, this paper shows how reranking--a common feature in all actual fiscal systems--reduces the predictive power of simple measures of progressivity in assessing the actual effect of taxes and transfers on inequality.
