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A Gendered Fiscal Incidence Analysis for Ethiopia : Evidence from Individual-Level Data

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  • Ambel,Alemayehu A.
  • Tesfaye,Wondimagegn Mesfin
  • Yonis,Manex Bule

Abstract

Using the Commitment to Equity methodology, this study investigates differences in thewelfare impact of taxes and government spending on men and women in Ethiopia. It analyzes the incidence, progressivity,and pro-poorness of various taxes and transfers and their effects on income mobility, poverty, and inequality usingindividual-level data from the 2018/19 Ethiopia Socioeconomic Survey. The results show that the fiscalsystem as a whole is progressive, equalizing, and poverty-reducing. It moved about one in five individualsfrom one income group to another, and more women than men transitioned to a higher income group, making themrelatively better off. However, some of its elements have differential effects on gender equality. Direct and indirecttaxes have differential inequality-reducing and poverty-increasing effects for men and women. Theinequality-reducing effects are stronger for men, whereas the poverty-increasing effects of some of them, includinginformal taxes and value-added taxes, are higher for women. On the transfer side, direct social protection transfers andindirect transfers, mainly spending on primary education and health services, promote gender equality better than othertypes of government spending.

Suggested Citation

  • Ambel,Alemayehu A. & Tesfaye,Wondimagegn Mesfin & Yonis,Manex Bule, 2022. "A Gendered Fiscal Incidence Analysis for Ethiopia : Evidence from Individual-Level Data," Policy Research Working Paper Series 10130, The World Bank.
    • Handle: RePEc:wbk:wbrwps:10130
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    References listed on IDEAS

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