Abstract
The aim of this paper is to show that social security in Italy is marked by large inefficiencies in resource distribution and allocation. Vertical redistribution is quite limited, mainly because of, first, the regressive effects of financing based on salary-geared contributions, and, second, the fact that pensions and family allowances are exempt from personal income tax. Most redistribution is horizontal, but there are also serious maldistributions, which go against vertical and horizontal equity. On the whole, the amount and the direction of redistribution seems often to have been determined by chance or by pressure groups. Inefficiency in allocation is serious in the health sector, where there is waste and where there are privileges for certain groups of citizens. Maldistribution, waste and privileges use up a considerable amount of social security finance. This amount could be used to meet the community’s strong and growing demand for more benefits for the poorer groups, especially for increases in the currently insufficient minimum pensions, and for better and more complete health services.
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© 1977 International Economic Association
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Reviglio, F. (1977). Redistribution through Social Security: A Lesson from Italy. In: Feldstein, M.S., Inman, R.P. (eds) The Economics of Public Services. International Economic Association Conference Volumes. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-02917-4_10
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DOI: https://doi.org/10.1007/978-1-349-02917-4_10
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