IDEAS home Printed from https://ideas.repec.org/p/ude/wpaper/2311.html
   My bibliography  Save this paper

Redistributive effects of indirect taxes: comparing arithmetical and behavioral simulations in Uruguay

Author

Listed:
  • Verónica Amarante

    (Instituto de Economía, Facultad de Ciencias Económicas y de Administración, Universidad de la República)

  • Marisa Bucheli

    (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República)

  • Cecilia Olivieri

    (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República)

  • Ivone Perazzo

    (Instituto de Economía, Facultad de Ciencias Económicas y de Administración, Universidad de la República)

Abstract

In this brief paper we compare the redistributive effect of a VAT reform using an arithmetical and a behavioral microsimulation model. We analyze the effects of the elimination of the VAT for a basket of goods which is intensively consumed by the poorest population. Our microsimulations are based on data from the expenditure survey. The behavioral model uses the Quadratic Almost Ideal Demand System (QUAIDS) proposed by Banks et al (1997). Our results indicate that the change in the VAT implies a redistributive effect of small magnitude. The comparison of redistributive effects under the arithmetic and the behavioral simulation reveals that they are very similar.

Suggested Citation

  • Verónica Amarante & Marisa Bucheli & Cecilia Olivieri & Ivone Perazzo, 2011. "Redistributive effects of indirect taxes: comparing arithmetical and behavioral simulations in Uruguay," Documentos de Trabajo (working papers) 2311, Department of Economics - dECON.
    • Handle: RePEc:ude:wpaper:2311
    as

    Download full text from publisher

    File URL: https://hdl.handle.net/20.500.12008/2214
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. François Bourguignon & Amedeo Spadaro, 2006. "Microsimulation as a tool for evaluating redistribution policies," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 4(1), pages 77-106, April.
    2. James Banks & Richard Blundell & Arthur Lewbel, 1997. "Quadratic Engel Curves And Consumer Demand," The Review of Economics and Statistics, MIT Press, vol. 79(4), pages 527-539, November.
    3. Deaton, Angus S & Muellbauer, John, 1980. "An Almost Ideal Demand System," American Economic Review, American Economic Association, vol. 70(3), pages 312-326, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Cathal O'Donoghue & Beenish Amjad & Jules Linden & Nora Lustig & Denisa Sologon & Yang Wang, 2025. "The Distributional Impact of Inflation in Pakistan: A Case Study of a New Price Focused Microsimulation Framework, PRICES," Working Papers 679, ECINEQ, Society for the Study of Economic Inequality.
    2. Verónica Amarante & Maira Colacce & Victoria Tenenbaum, 2019. "The National Care System in Uruguay: Who Benefits and Who Pays?," Population and Development Review, The Population Council, Inc., vol. 45(S1), pages 97-122, December.
    3. Cathal ODonoghue & Beenish Amjad & Jules Linden & Nora Lustig & Denisa Sologon & Yang Wang, 2023. "The Distributional Impact of Inflation in Pakistan: A Case Study of a New Price Focused Microsimulation Framework, PRICES," Papers 2310.00231, arXiv.org, revised Mar 2024.
    4. Cathal O'Donoghue & Beenish Amjad & Jules Linden & Nora Lustig & Denisa Sologon & Yang Wang, 2025. "The Distributional Impact of Inflation in Pakistan: A Case Study of a New Price Focused Microsimulation Framework, PRICES," Working Papers 2501, Tulane University, Department of Economics.
    5. Verónica Amarante & Maira Colacce & Victoria Tenenbaum, 2019. "The National Care System in Uruguay: Who Benefits and Who Pays?," Population and Development Review, The Population Council, Inc., vol. 45(S1), pages 97-122, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Heindl, Peter & Löschel, Andreas, 2015. "Social implications of green growth policies from the perspective of energy sector reform and its impact on households," ZEW Discussion Papers 15-012, ZEW - Leibniz Centre for European Economic Research.
    2. Barnett, William A. & Erwin Diewert, W. & Zellner, Arnold, 2011. "Introduction to measurement with theory," Journal of Econometrics, Elsevier, vol. 161(1), pages 1-5, March.
    3. Thomas F. Crossley & Hamish W. Low, 2011. "Is The Elasticity Of Intertemporal Substitution Constant?," Journal of the European Economic Association, European Economic Association, vol. 9(1), pages 87-105, February.
    4. Hovhannisyan, Vardges & Stiegert, Kyle W. & Bozic, Marin, 2013. "On Endogeneity Of Retail Market Power In An Equilibrium Analysis: A Control Function Approach," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 149830, Agricultural and Applied Economics Association.
    5. Barnett, William A. & Serletis, Apostolos, 2008. "Consumer preferences and demand systems," Journal of Econometrics, Elsevier, vol. 147(2), pages 210-224, December.
    6. Allais, Olivier & Etilé, Fabrice & Lecocq, Sébastien, 2015. "Mandatory labels, taxes and market forces: An empirical evaluation of fat policies," Journal of Health Economics, Elsevier, vol. 43(C), pages 27-44.
    7. Barnett, William A. & Serletis, Apostolos, 2008. "The Differential Approach to Demand Analysis and the Rotterdam Model," MPRA Paper 12319, University Library of Munich, Germany.
    8. Paris, Quirino & Caracciolo, Francesco, 2012. "Quantity Versus Shares in Estimating Demand Systems," Working Papers 124575, University of California, Davis, Department of Agricultural and Resource Economics.
    9. Noriko Amano, 2018. "Nutrition Inequality: The Role of Prices, Income, and Preferences," 2018 Meeting Papers 453, Society for Economic Dynamics.
    10. repec:spo:wpmain:info:hdl:2441/vbu6kd1s68o6r34k5bcm3iopv is not listed on IDEAS
    11. Peltner, Jonas & Thiele , Silke, 2021. "Elasticities of Food Demand in Germany – A Demand System Analysis Using Disaggregated Household Scanner Data," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 70(01), January.
    12. John Curtis & Brian Stanley, 2016. "Analysing Residential Energy Demand: An Error Correction Demand System Approach for Ireland," The Economic and Social Review, Economic and Social Studies, vol. 47(2), pages 185-211.
    13. Korir, Lilian & Rizov, Marian & Ruto, Eric, 2020. "Food security in Kenya: Insights from a household food demand model," Economic Modelling, Elsevier, vol. 92(C), pages 99-108.
    14. McKelvey, Christopher, 2011. "Price, unit value, and quality demanded," Journal of Development Economics, Elsevier, vol. 95(2), pages 157-169, July.
    15. Hoderlein, Stefan & Holzmann, Hajo & Meister, Alexander, 2017. "The triangular model with random coefficients," Journal of Econometrics, Elsevier, vol. 201(1), pages 144-169.
    16. Anonymous & Bosch, Darrell J., 2013. "Table of contents," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 45(01), February.
    17. Xavier Labandeira & José M. Labeaga & Miguel Rodríguez, 2006. "A Residential Energy Demand System for Spain," The Energy Journal, International Association for Energy Economics, vol. 0(Number 2), pages 87-112.
    18. Brannlund, Runar & Nordstrom, Jonas, 2004. "Carbon tax simulations using a household demand model," European Economic Review, Elsevier, vol. 48(1), pages 211-233, February.
    19. Germán Coloma, 2019. "The Effect of Horizontal Mergers on Efficiency and Market Power: An Application to the Argentine Hamburger Market," CEMA Working Papers: Serie Documentos de Trabajo. 705, Universidad del CEMA.
    20. Irz, Xavier & Mazzocchi, Mario & Réquillart, Vincent & Soler, Louis-Georges, 2015. "Research in Food Economics: past trends and new challenges," Revue d'Etudes en Agriculture et Environnement, Editions NecPlus, vol. 96(01), pages 187-237, March.
    21. Labandeira, Xavier & Labeaga, José M. & Rodríguez, Miguel, 2009. "An integrated economic and distributional analysis of energy policies," Energy Policy, Elsevier, vol. 37(12), pages 5776-5786, December.

    More about this item

    Keywords

    fiscal redistribution; income inequality; taxes;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ude:wpaper:2311. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Andrea Doneschi or the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/derauuy.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.