The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Horizontal and Vertical Equity

  • Jean-Yves Duclos
Reference work entry
DOI: https://doi.org/10.1057/978-1-349-95189-5_1961

Abstract

This article describes the concepts of vertical and horizontal equity and provides some normative and positive justifications for them. It then outlines a few of the measures that have been proposed to assess whether government policies, and tax and transfer systems in particular, are vertically and horizontally equitable. It also points to useful references in the literature.

Keywords

Concentration curve Discrimination Equality of opportunity Equality of resources Hobbes, T. Horizontal equity Liability progression Locke, J. Lorenz curve Nozick, R. Positioning Procedural equity Progressive and regressive taxation Rawls, J. Redistribution of income Relative deprivation Residual progression Sen, A. Social justice Utilitarianism Veil of ignorance Vertical equity Well-being 
This is a preview of subscription content, log in to check access

Bibliography

  1. Aronson, R., P. Johnson, and P. Lambert. 1994. Redistributive effect and unequal income tax treatment. Economic Journal 104: 262–270.CrossRefGoogle Scholar
  2. Aronson, R., and P. Lambert. 1994. Decomposing the Gini Coefficient to reveal the vertical, horizontal, and reranking effects of income taxation. National Tax Journal 47: 273–294.Google Scholar
  3. Atkinson, A. 1979. Horizontal equity and the distribution of the tax burden. In The economics of taxation, ed. H. Aaron and M. Boskin. Washington, DC: Brookings Institution.Google Scholar
  4. Auerbach, A., and K. Hassett. 2002. A new measure of horizontal equity. American Economic Review 92: 1116–1125.CrossRefGoogle Scholar
  5. Blum, W., and H. Kahen Jr. 1963. The uneasy case for progressive taxation. Chicago: University of Chicago Press.Google Scholar
  6. Cowell, F. 1995. Measuring inequality. London: Prentice Hall, Harvester Wheatsheaf.Google Scholar
  7. Duclos, J.-Y., and A. Araar. 2006. Poverty and equity: Measurement, policy and estimation with DAD. Boston: Springer.Google Scholar
  8. Duclos, J.-Y., and P. Lambert. 2000. A normative approach to measuring classical horizontal inequity. Canadian Journal of Economics 33: 87–113.CrossRefGoogle Scholar
  9. Fellman, J. 1976. The effect of transformations on Lorenz curves. Econometrica 44: 823–824.CrossRefGoogle Scholar
  10. Harsanyi, J. 1955. Cardinal welfare, individualistic ethics, and interpersonal comparisons of utility. Journal of Political Economy 63: 309–321.CrossRefGoogle Scholar
  11. Jakobsson, U. 1976. On the measurement of the degree of progression. Journal of Public Economics 5: 161–168.CrossRefGoogle Scholar
  12. Jenkins, S., and P. Lambert. 1999. Horizontal inequity measurement: A basic reassessment. In Handbook of income inequality measurement. With a foreword by Amartya Sen, ed. J. Silber. Boston/London: Dordrecht/Kluwer.Google Scholar
  13. Kakwani, N. 1977a. Applications of Lorenz curves in economic analysis. Econometrica 45: 719–728.CrossRefGoogle Scholar
  14. Kakwani, N. 1977b. Measurement of tax progressivity: An international comparison. Economic Journal 87: 71–80.CrossRefGoogle Scholar
  15. Kaplow, L. 1989. Horizontal equity: Measures in search of a principle. National Tax Journal 42: 139–154.Google Scholar
  16. King, M. 1983. An index of inequality: With applications to horizontal equity and social mobility. Econometrica 51: 99–116.CrossRefGoogle Scholar
  17. Lambert, P. 2001. The distribution and redistribution of income. 3rd ed. Manchester/New York: Manchester University Press ; distributed by Palgrave, New York.Google Scholar
  18. Lambert, P., and X. Ramos. 1997. Horizontal inequity and vertical redistribution. International Tax and Public Finance 4: 25–37.CrossRefGoogle Scholar
  19. Musgrave, R. 1959. The theory of public finance. New York: McGraw-Hill.Google Scholar
  20. Musgrave, R. 1990. Horizontal equity, once more. National Tax Journal 43: 113–122.Google Scholar
  21. Musgrave, R., and T. Thin. 1948. Income tax progression 1929–48. Journal of Political Economy 56: 498–514.CrossRefGoogle Scholar
  22. Nozick, R. 1974. Anarchy, state and utopia. Oxford: Basil Blackwell.Google Scholar
  23. Pfahler, W. 1987. Redistributive effects of tax progressivity: Evaluating a general class of aggregate measures. Public Finance/Finances Publiques 42: 1–31.Google Scholar
  24. Plotnick, R. 1981. A measure of horizontal inequity. Review of Economics and Statistics 62: 283–288.CrossRefGoogle Scholar
  25. Plotnick, R. 1982. The concept and measurement of horizontal inequity. Journal of Public Economics 17: 373–391.CrossRefGoogle Scholar
  26. Rawls, J. 1971. A theory of justice. Cambridge, MA: Harvard University Press.Google Scholar
  27. Reynolds, M., and E. Smolensky. 1977. Public expenditure, taxes and the distribution of income: The United States, 1950, 1961, 1970. New York: Academic Press.Google Scholar
  28. Sen, A. 1985. Commodities and capabilities. Amsterdam: North-Holland.Google Scholar
  29. Slitor, R. 1948. The measurement of progressivity and built-in flexibility. Quarterly Journal of Economics 62: 309–313.CrossRefGoogle Scholar
  30. Suits, D. 1977. Measurement of tax progressivity. American Economic Review 67: 747–752.Google Scholar
  31. Vickrey, W. 1972. Agenda for progressive taxation. 1st ed. New York: Ronald Press.Google Scholar

Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Jean-Yves Duclos
    • 1
  1. 1.