Assessing the Impact of Tax-Benefit Policies on Inequality of Opportunity: Evidence from Brazil and Peru

Assessing the Impact of Tax-Benefit Policies on Inequality of Opportunity: Evidence from Brazil and Peru | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article Assessing the Impact of Tax-Benefit Policies on Inequality of Opportunity: Evidence from Brazil and Peru H. Xavier Jara, Anustup Kundu, Jukka Pirttilä This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-9574369/v1 This work is licensed under a CC BY 4.0 License Status: Under Review Version 1 posted 6 You are reading this latest preprint version Abstract This paper evaluates how tax and transfer systems in Brazil and Peru affect equality of opportunity. Using detailed household data and tax–benefit microsimulation models, we decompose total income inequality into within‑type and between‑type components, where types are defined by predetermined circumstances such as parental background. We first measure inequality of opportunity in market incomes and then assess how much redistribution reduces it. The results show that existing fiscal systems achieve only modest reductions in overall inequality: the Gini coefficient falls by 0.02–0.08 points. Their impact on equality of opportunity is even smaller, with the between‑types component declining by less than 0.01 Gini points in both countries. The paper also runs counterfactual simulations, including an analysis of the required redistribution to completely eradicate between‑type inequality. Full Text Additional Declarations No competing interests reported. Cite Share Download PDF Status: Under Review Version 1 posted Reviews received at journal 16 May, 2026 Reviewers agreed at journal 08 May, 2026 Reviewers invited by journal 08 May, 2026 Editor assigned by journal 01 May, 2026 Submission checks completed at journal 01 May, 2026 First submitted to journal 30 Apr, 2026 You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. Our growing team is made up of researchers and industry professionals working together to solve the most critical problems facing scientific publishing. Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-9574369","acceptedTermsAndConditions":true,"allowDirectSubmit":false,"archivedVersions":[],"articleType":"Research Article","associatedPublications":[],"authors":[{"id":641192598,"identity":"ad0cb06e-ea3e-4a9d-8d4c-a05c78820115","order_by":0,"name":"H. 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