The Effects of Social Spending on Income Inequality in 30 OECD Countries

Year 2021, Volume: 71 Issue: 1, 39 - 57, 16.07.2021

Can Verberi , Sema Yaşar

Abstract

Social spending programs began to be implemented in the post-World War II period owing to the positive developments in economic and demographic indicators. In the following years, governments used social spending programs to eliminate income differences between income groups due to their increasing social benefit function. Hence, the redistribution of income from high-income groups to low-income groups occurs through taxation. The unfairly distributed income lead to not direct human capital and public resources for productive economic activities. Accordingly, governments try to minimize or remove the negative effects of income inequality by social spendings. The study aims at investigating the relationship between social spendings and income inequality in 2009, 2011, the years when the effect of the 2008 crisis observed in the world, and 2015 not being the crisis year by the OLS method by cross-section regression analysis in 30 OECD countries. The analysis results show that an increase in social spending reduces income inequality. Moreover, trade openness negatively affects income inequality, unemployment increases income inequality, and it is possible to interpret that the positive effect of social expenditures on income distribution decreased during the crisis years by compared to the year-based estimation results.

Keywords

Income inequality, Social spendings, Cross section data analysis

30 OECD Ülkesinde Sosyal Harcamaların Gelir Eşitsizliği Üzerindeki Etkisi

Abstract

Sosyal harcama programları İkinci Dünya Savaşı sonrasındaki dönemde yaşanan olumlu ekonomik ve demografik gelişmeler sonucu uygulanmaya başlamıştır. Daha sonraki yıllarda ise hükümetler sosyal faydayı artırma fonksiyonundan dolayı sosyal harcama programlarını gelir grupları arasındaki gelir farklılıklarının giderilmesi amacıyla bir araç olarak kullanmıştır. Böylece, vergilendirme yoluyla gelirin yüksek gelirli gruplardan düşük gelirli gruplara transferiyle yeniden dağıtımı gerçekleşmektedir. Adaletsiz dağıtılan gelir, beşeri sermaye ve kamu kaynaklarının verimli ekonomik faaliyetlere yönlendirilmemesine yol açmaktadır. Bu nedenle hükümetler sosyal harcamalarla gelir eşitsizliğinin olumsuz etkilerini en aza indirmeye veya tamamen kaldırmaya çalışmaktadırlar. Çalışma 2008 krizinin etkisinin dünyada hissedildiği yıllar olan 2009, 2011 ve kriz yılı olmayan 2015 yıllarında seçilmiş 30 OECD ülkesindeki sosyal harcamalar ile gelir eşitsizliği arasındaki ilişkiyi incelemeyi amaçlamaktadır. Analiz sonuçları, sosyal harcamalardaki artışın gelir eşitsizliğini azalttığını göstermektedir. Aynı zamanda, ticari açıklığın gelir eşitsizliğini olumsuz yönde etkilediği, işsizliğin gelir eşitsizliğini artırdığı ve yıl bazlı tahmin sonuçları karşılaştırıldığında ise, sosyal harcamaların gelir dağılımına yönelik olumlu etkisinin kriz yıllarında azaldığı yorumunu yapmak mümkündür.

Keywords

Gelir eşitsizliği, Sosyal harcamalar, Yatay kesit veri analizi

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