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Redistribution from a lifetime perspective

Peter Levell, Barra Roantree and Jonathan Shaw
IFS Working Paper W15/27

Most analysis of the effects of the tax and benefit system is based on snapshot information about a single cross-section of people. Such an approach gives only a partial picture because it cannot account for the fact that circumstances change over life. This paper investigates how our impression of redistribution undertaken by the tax and benefit system changes when viewed from a lifetime perspective. To do so, we simulate lifecycle data designed to be representative of the experiences of the baby-boom cohort, born 1945–54. We examine the properties of the current tax and benefit system as well as historical and hypothetical reforms from both a lifetime and a snapshot perspective. We find that much of what the tax and benefit system achieves is effectively to redistribute across periods of life and, as a result, it is much less effective at reducing lifetime inequality than inequality at a snapshot.

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Presentation
This presentation was delivered at the 'Redistribution from a lifetime perspective' event held at the Nuffield Foundation on 22nd September 2015.
Presentation
This presentation was delivered at the 'Redistribution from a lifetime perspective' event held at the Nuffield Foundation on 22nd September 2015.
Presentation
This presentation is one of a series on the economics of tax policy.
Presentation
This presentation was delivered at the 'Redistribution from a lifetime perspective' event held at the Nuffield Foundation on 22nd September 2015.
Press release
In a single year, 64% of individuals in the UK pay more in taxes than they receive in social security. But most individuals experience considerable change over their lifetimes: for example those not in paid work in one year are often in work in another year. New analysis, published by the Institute ...