Wednesday, November 27, 2019

Taxes & transfers redistribute income

IN the graph above, the share of income earned by the top 1% is plotted against time.  Based on pre-tax income, it looks as if the share has doubled.  But this does not take account of our progressive tax system and government transfer payments, like Medicaid, (bottom line).  The after-tax and after-transfer shares of the richest look pretty flat.  

HT:  Greg Mankiw

1 comment:

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