Lecture 19 POLS 207 Outline of Last Lecture Who Bears a Tax Burden I Types of taxes A Income B Consumption C Real property II Tax level v Tax burden III Types of tax systems VERY IMPORTANT to understand for the test A Regressive B Progressive C Proportional Neutral Outline of Current Lecture Income Inequality I Definitions of income A Pre tax B Post transfer C Money income II Increasing income inequality since the 1960s Current Lecture Brief tangent on the distribution of income This provides us with a data template for the tax system How do we figure out what part of the population is getting what percentage of income Who Pays Institute on Taxation and Economic Policy The Who Pays study looks only at non elderly households See Neo slides How do you define income Different categories of income Pre tax how much income is flowing into different income categories quartiles quintiles etc based on gross income before any kind of taxes or fees post transfer Meaning the money can come from anywhere wages social security checks whatever money income Physical money as opposed to other sources of income such as food stamps government housing etc Income data for 2000 There is more income equality among top 20 than there is in lower income brackets Census Bureau s definition of income pre tax post transfer money income Alternative explanations for INCREASING income inequality since late 1960s NOTE Slow DECLINE between 1930s 1960s They range from denial to explanations that focus on how we measure e g income to some demographic changes to globalization pressures on wages to an increasing education premium the concept that those with an education make a better salary than those without an education to government tax policies rewarding investors over wage earners
View Full Document
Unlocking...