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CEQ Working Paper No 4: Fiscal Incidence, Fiscal Mobility and the Poor


Fiscal Incidence, Fiscal Mobility and the Poor
Working Paper No. 4

A working document by:
Nora Lustig
Samuel Z. Stone Professor of Latin American Economics, Tulane University and Non-resident Senior Fellow at the Center for Global Development and Inter-American Dialogue
Sean Higgins
Doctoral student of PhD in Economics, Tulane University

Abstract
Taxes and transfers can have significant impacts on poverty and inequality. All standard measures are by definition anonymous in the sense that we do not know the identity of winners and losers. That a given combination of taxes and transfers makes some of the poor poorer, however, may be important information to incorporate into a fiscal incidence analysis. The directional mobility literature provides a useful framework to identify which individuals are adversely/favorably impacted by a particular policy. This paper introduces a ‘€œfiscal mobility matrix‘€ to identify winners and losers. We show that taxes and transfers can lower inequality and poverty (including the severity of poverty) but still make a subgroup of the poor worse off. We use Brazilian data to illustrate how indirect taxes make around 11 percent of the non-poor poor, 15 percent of the moderate poor extremely poor, and 4 percent of the extremely poor ‘€œultra-poor‘€ despite any cash transfers they receive, even when standard poverty and inequality indicators decline and overall taxes are progressive.

Access the working document here:
Updated January 2013
CEQ Working Paper No 4: Fiscal Incidence, Fiscal Mobility and the Poor

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Martín Fernández, editorial director of Casa Editorial HUM and Estuario Editora in Montevideo, Uruguay, presents the houses’ histories, missions, and ongoing projects. His presentation sheds light on the changing landscape of literature in the Americas today. It will be followed by an informal reception. Note: This event will be held in Spanish.

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Este serie reúne a los autores más representativos de la escritura continental y los editores que los publican. A través de entrevistas con la reconocida escritora ecuatoriana Gabriela Alemán y presentaciones de proyectos editoriales, los invitados explorarán los vínculos entre el mundo literario y la realidad continental. Sus conversaciones se convertirán después en el eje de un archivo digital que busca llevar estas ideas a un público global.

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Martin Fernández is the Editorial director of the publishing houses Casa Editorial HUM and Estuario Editora in Montevideo, Uruguay. He founded HUM in 2007 after leaving his previous project, the underground publishing house ArteFato, which he co-directed between 2004 and 2007. HUM and Estuario publish contemporary Uruguayan literature in high-quality, aesthetically distinct editions. They have collectively released more than 400 titles.

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Ecuadorian writer and Tulane Visiting Scholar Gabriela Alemán interviews Venezuelan writer Alberto Barrera Tyszka about his life, interests, and influences. Their discussion will be followed by an open Q&A and an informal reception. This event will be held in Spanish.

About the Latin American Writers Series

This series brings together Latin America’s most representative creative voices and the editorial entrepreneurs that publish them. By way of interviews conducted by renowned Ecuadorian writer Gabriela Alemán and presentations of various editorial missions, the guests will shed light on a literary world shaped by the contemporary issues of the continent. Moving forward, their conversations will comprise the centerpiece of a digital archive that introduces their ideas to a global audience.

Este serie reúne a los autores más representativos de la escritura continental y los editores que los publican. A través de entrevistas con la reconocida escritora ecuatoriana Gabriela Alemán y presentaciones de proyectos editoriales, los invitados explorarán los vínculos entre el mundo literario y la realidad continental. Sus conversaciones se convertirán después en el eje de un archivo digital que busca llevar estas ideas a un público global.

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Born in Caracas, Alberto Barrera Tyszka has published over a dozen works of poetry, short story, chronicle, novel, and biography. His most recent publications include the novels Patria o Muerte (2015) and Rating (2011), the poetic anthology La inquietud (2013), the collection of chronicles Un país a la semana (2013), and the short story collection Crímenes (2009). In 2005, he collaborated with Cristina Marcano to write the definitive biography of Hugo Chávez, Hugo Chávez sin uniforme: una historia personal (2005). Patria o muerte won the 2015 Premio Tusquets de Novela, and his novel La enfermedad, translated into English as The Sickness (2010), received the 2006 Herralde Award. Barrera also writes for television and has scripted soap operas for Venezuelan, Mexican, Colombian, and Argentinian networks.