A redistribution of income in a country can be best brought about through

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Q: 2 (IAS/1996)
A redistribution of income in a country can be best brought about through

question_subject: 

Economics

question_exam: 

IAS

stats: 

0,109,147,125,109,9,13

keywords: 

{'redistribution': [0, 1, 0, 0], 'regressive taxation': [0, 1, 0, 0], 'progressive taxation': [0, 1, 1, 0], 'progressive expenditure': [0, 1, 0, 0], 'regressive expenditure': [0, 1, 0, 0], 'income': [0, 3, 0, 0]}

Alert - correct answer should be option 1

To achieve a redistribution of income in a country (which effectively embodies wealth redistribution or reducing income equality), the most suitable method would be through progressive taxation combined with progressive expenditure (option 1).

Progressive taxation means that the tax rate increases as the taxable amount (income or wealth) increases. This approach makes wealthier individuals pay more taxes, effectively taking a larger portion of income from those who can more easily shoulder the burden.

Progressive expenditure implies spending more on programs that benefit lower-income individuals (such as subsidized education, health care, and support services). This method allows for the redistribution of wealth by transferring more resources to those in need.

Option 2 might increase inequality, as regressive expenditure infers that the proportion of spending that aids lower-income individuals decreases as their income level rises.

Option 3 would also exacerbate inequality because regressive taxation and expenditure require lower-income individuals to bear a larger burden relative to their income.

Option 4 could result in a conflicting outcome, as regressive taxation would increase the burden on low-income individuals, while progressive expenditure would benefit them simultaneously.

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