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The Impact of Federal Income Taxes and Cash Transfers On the Distribution of Lifetime Household Income, 1969-1981

Author

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  • John Fitzgerald

    (Bowdoin College)

  • Tim Maloney

    (Bowdoin College)

Abstract

This study uses a longitudinal sample of stable households to assess the impact of federal taxes and transfers on the distribution of household income during the period 1969-1981. After controlling for the upward movement in age-income profiles across birth year cohorts, earned lifetime incomes are found to be more equally distributed than earned annual incomes. The overall tax and transfer system is found to have a larger redistributive effect on lifetime incomes. While taxes are relatively more important than transfers in reducing lifetime income inequality among married couples, the opposite is true for single-headed households. Taxes and transfers also redistribute lifetime income from married couples to single-headed households.

Suggested Citation

  • John Fitzgerald & Tim Maloney, 1990. "The Impact of Federal Income Taxes and Cash Transfers On the Distribution of Lifetime Household Income, 1969-1981," Public Finance Review, , vol. 18(2), pages 182-197, April.
    • Handle: RePEc:sae:pubfin:v:18:y:1990:i:2:p:182-197
    DOI: 10.1177/109114219001800203
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    References listed on IDEAS

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    Cited by:

    1. Joel B. Slemrod, 1992. "Taxation and Inequality: A Time-Exposure Perspective," NBER Chapters, in: Tax Policy and the Economy, Volume 6, pages 105-128, National Bureau of Economic Research, Inc.
    2. Yingxu Kuang & Ted Englebrecht & Otis W. Gilley, 2011. "A Distributional Analysis of the FairTax Plan: Annual and Lifetime Income Considerations," Southern Economic Journal, John Wiley & Sons, vol. 78(2), pages 358-381, October.

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