Wealth redistribution policies
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Wealth Redistribution Policies. Shahid Beheshti University of Medical Sciences School of Medical Education Strategic Policy Sessions: 05. “It’s Your money, not the government’s” Ronald Reagan.

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Wealth redistribution policies

Wealth Redistribution Policies

Shahid Beheshti University of Medical Sciences

School of Medical Education

Strategic Policy Sessions: 05


It s your money not the government s ronald reagan

“It’s Your money, not the government’s”Ronald Reagan


Wealth redistribution policies

“As long as there existed a business owning, class oppression would continue. Private property is illegal.Karl Marx


What is an ideology

What is an Ideology?

  • Generally speaking, it is a value system through which we perceive, explain and accept the world.

  • According to the political theorist Robert Dahl, all individuals are ideologues in the sense that we all map out our own interpretations of what the world is and how it should be.


The major components of ideologies

The Major Components of Ideologies

  • The state of human nature

  • The role of the individual in society

  • The role of the state

  • The sources and limits of political authority

  • The preferred economic and social order


Ideologies the preferred economic and social order

Ideologies: The Preferred Economic and Social Order

  • Ideologies have to deal with the fundamental question of who controls the wealth in society. Should wealth be equally shared, or should some individuals be allowed to possess more wealth than others?

  • For communists, private ownership is not allowed. They are committed to providing an equitable distribution of wealth

  • For capitalists, people need to compete with one another in order to have an incentive for material gain. Economic and social inequities are allowed to exist


The economy

“The Economy”

  • How politics and economics interact, and how they balance conflicting values of freedom and equality


Components of political economy

Components of Political Economy

  • Markets – interaction between supply and demand that functions to allocate resources

    • Freely allow individuals to buy, sell, and trade what they produce for what they will consume

    • Sets values, or “prices” for these goods and services

    • Markets arise spontaneously, and are difficult for the state to control


Components of political economy1

Components of Political Economy

  • Property – ownership of goods and services

    • State can choose to play a role in protecting property rights – the right to sell property freely, or to not have it taken away

      • In LDCs, frequently property exists without a fundamental protection of property rights, due to the state’s inability to monitor instances of fraud


Components of political economy2

Components of Political Economy

  • Public Goods – goods provided and/or secured by the state

    • Examples (universal): Roads, lighthouses, the military

    • Examples (in some cases)

      • Health care in Britain, Canada

      • Oil in Nigeria and Saudi Arabia

      • Most businesses in Cuba


Components of political economy3

Components of Political Economy

  • Taxation

    • Means to provide for public goods and social expenditures

    • Subject of political battles, determined partially by ideology toward the role of the state


Components of political economy4

Components of Political Economy

  • Social Expenditures

    • Commonly called “The Welfare State” – redistribution of wealth through government taxing some, and paying others

    • Typically provided to the elderly, the unemployed, the poor, and the disabled

    • Often a subject of political battle, due to the question of who benefits from expenditures


Components of political economy5

Components of Political Economy

  • Money, Inflation, and Unemployment

    • States create and manage the money supply through a central bank

    • Creation of too much money in effort to stimulate the economy and reduce unemployment can cause inflation

    • Slowing the growth of money to control inflation can slow economic growth and cause unemployment to rise


Components of political economy6

Components of Political Economy

  • Regulation – rules or orders to set the boundaries of given procedures

    • States can ban production or sale of goods, set safety requirements, outlaw monopoly control, etc.

  • Trade – access to goods and services from foreign states

    • States can allow open trade, or restrict it through tariffs, quotas, and other non-tariff barriers


Tax rates as of gdp 2008

Sweden: 54.2 %

Denmark: 48.8 % 

Finland: 46.9 %  

Belgium: 45.6 %

France: 45.3 %  

Austria: 43.7 %  

Italy: 42 %  

Netherlands: 41.4 %

Norway: 40.3 %  

Germany: 37.9 %

United Kingdom: 37.4 %

Russia: 36.9 %

Canada: 35.8 %

Switzerland: 35.7 %

New Zealand: 35.1 %

Australia: 31.5 %

Ireland: 31.1 %  

United States: 29.6 %

Japan: 27.1 %  

China: 17%

Mexico: 9.7%

Iran: 7.3%

Nigeria: 6.1%

Tax Rates as % of GDP (2008)


Gini coefficient for the 6 countries

Gini Coefficient for the 6 Countries

  • Sweden – 23.1

  • Germany – 28.3

  • U.S. – 40.8

  • China – 44.7

  • United Kingdom – 36.0

  • Russia – 31.0

  • Mexico – 54.6

  • Iran – 43.0

  • Nigeria – 50.6


Wealth redistribution policies

Success is one percent inspiration and ninety-nine percent perspiration

Priori

Experience

=

Posteriori

+

Where I was born

Inspiration

Who am I now

Who are my parents

=

+

Perspiration

What have I now

How I was developed

What is my IQ


Wealth redistribution

Wealth Redistribution

  • Revenue Model

    • Logarithmic (Regressive)

    • Full Range Increasing (Proportional)

    • Increasing (Proportional) with Threshold

    • Exponential (Progressive)

  • Payback Model

    • Full Range Flat Rate

    • Flat Rate with Threshold

    • Full Range Decreasing

    • Decreasing with Threshold

    • Inverse Exponential


Wealth redistribution policies

Income Redistributive Policies

Full-Range

Flat Rate

Flat Rate

with Threshold

Inverse

Exponential

Full-Range

Decreasing

Decreasing

with Threshold

Full Range

Increasing

Increasing

with Threshold

Exponential


Income redistributive policies

Income Redistributive Policies

Tax Reduced

Allowance Added Income

Income


Income redistributive policies1

Income Redistributive Policies

Tax Reduced

Allowance Added Income

Income


Income redistributive policies2

Income Redistributive Policies

Tax Reduced

Allowance Added Income

Income


Income redistributive policies3

Income Redistributive Policies

Tax Reduced

Allowance Added Income

Income


Income redistributive policies4

Income Redistributive Policies

Tax Reduced

Allowance Added Income

Income


Income redistributive policies5

Income Redistributive Policies

Tax Reduced

Allowance Added Income

Income


Income redistributive policies6

Income Redistributive Policies

Tax Reduced

Allowance Added Income

Income


Income redistributive policies7

Income Redistributive Policies

Tax Reduced

Allowance Added Income

Income


Income redistributive policies8

Income Redistributive Policies

Tax Reduced

Allowance Added Income

Income


Income redistributive policies9

Income Redistributive Policies

Tax Reduced

Allowance Added Income

Income


Income redistributive policies10

Income Redistributive Policies

Tax Reduced

Allowance Added Income

Income


Income redistributive policies11

Income Redistributive Policies

Tax Reduced

Allowance Added Income

Income


Income redistributive policies12

Income Redistributive Policies

Tax Reduced

Allowance Added Income

Income


Income redistributive policies13

Income Redistributive Policies

Tax Reduced

Allowance Added Income

Income


Income redistributive policies14

Income Redistributive Policies

Tax Reduced

Allowance Added Income

Income


Wealth redistribution policies

Thank You !

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