Gramlich, Edward M., and Michael J. Wolkoff. 1979. "A Procedure for Evaluating Income Distribution Policies." Journal of Human Resources 14(3):319-350.

The paper develops a procedure for evaluating the social benefits of income redistribution programs. The procedure makes social benefit a function of both the mean and the variance of family income and needs of the recipients over time, with sensitivity tests to see how benefits change under various assumptions about donor preferences. Costs include budget costs and any gains or losses in producer or consumer surplus. The procedure is applied to three income redistribution programs; negative income taxes, public employment, and minimum wages. Using longitudinal data, we simulate the income needs paths of 2000 families with and without the programs and compare the social benefits and costs for the three programs.

The authors are, respectively, Professor of Economics and PhD candidate, Institute for Public Policy Studies, University of Michigan. Much of the work reported here was sponsored by a grant from the U.S. Department of Labor, Office of Policy, Evaluation, and Research. We have benefited from discussion of the project in a seminar given for numerous members of that office, a like experience with some students and colleagues in the Public Policy School of The University of Michigan, and the careful reading of Paul N. Courant, William Birdsall, and Fred Siskind.

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