Changes in Redistribution in OECD Countries Over Two Decades

This chapter takes stock of tax and transfer redistribution policies in OECD countries over the two decades preceding the global downturn in 2008. It begins by looking at evidence for the inequality-reducing effects of taxes and benefits. It considers trends in aggregate spending and revenues, shows how different components of taxes and benefits have evolved over time, and briefly discusses the influence of cyclical factors on the observed patterns. The chapter then uses household-income data to produce and compare a range of commonly used redistribution and progressivity indicators. Finally, it summarises policy changes and offers a detailed analysis of the role of policy in driving observed redistribution trends.