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Ten Years of Mrs Thatcher: the Distributional Consequences

Ten Years of Mrs Thatcher: the Distributional Consequences In the ten year period of Mrs Thatcher’s government, and especially over the last few years, there have been many changes to the tax and benefit system. In this short article we show how these changes have affected households in the UK. We performed a similar exercise in 1986, but this was before the recent large income tax cuts and national insurance and benefit reforms.’ As before, the question we ask is: ‘How much better or worse off are people now than they would have been had the tax and benefit system merely changed in line with retail price inflation since May 1979?’. To answer this we used data on incomes, expenditures and characteristics of the 7081 households in the 1984 Family Expenditure Survey (FES). This is a broadly representative sample of the UK population.2 The incomes and expenditures were uprated to current levels. We then used the IFS Tax and Benefit Model to calculate the changes in benefit entitlements and tax liabilities, and thus net incomes, between the current system and the system of 1979 uprated by the change in retail price^.^ This is perhaps a rather generous way of assessing policy, since it can be argued http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Fiscal Studies Wiley

Ten Years of Mrs Thatcher: the Distributional Consequences

JOHNSON, PAUL; STARK, GRAHAM
Fiscal Studies , Volume 10 (2) – May 1, 1989
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References (2)

Publisher
Wiley
Copyright
Copyright © 1989 Wiley Subscription Services, Inc., A Wiley Company
ISSN
0143-5671
eISSN
1475-5890
DOI
10.1111/j.1475-5890.1989.tb00107.x
Publisher site
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Abstract

In the ten year period of Mrs Thatcher’s government, and especially over the last few years, there have been many changes to the tax and benefit system. In this short article we show how these changes have affected households in the UK. We performed a similar exercise in 1986, but this was before the recent large income tax cuts and national insurance and benefit reforms.’ As before, the question we ask is: ‘How much better or worse off are people now than they would have been had the tax and benefit system merely changed in line with retail price inflation since May 1979?’. To answer this we used data on incomes, expenditures and characteristics of the 7081 households in the 1984 Family Expenditure Survey (FES). This is a broadly representative sample of the UK population.2 The incomes and expenditures were uprated to current levels. We then used the IFS Tax and Benefit Model to calculate the changes in benefit entitlements and tax liabilities, and thus net incomes, between the current system and the system of 1979 uprated by the change in retail price^.^ This is perhaps a rather generous way of assessing policy, since it can be argued

Journal

Fiscal Studies – Wiley

Published: May 1, 1989

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