乔纳森·格鲁伯-财政学（第五版）gruber_5e_lecture_slides_ch17.pptxVIP

Copyright ? 2010 Worth Publishers 17Heather Luea and Dan SacksP R E P A R E D B Y17.1 Facts on Income Distribution in the United States17.2 Welfare Policy in the United States17.3 The Moral Hazard Costs of Welfare Policy17.4 Reducing the Moral Hazard of Welfare17.5 ConclusionIncome Distribution and Welfare Programs 17Introduction: Differences in Life ExpectancyThe last week of April 2015, was marked by several weeks of violence in Baltimore, Maryland. Sparked by the death of minority prisoner Freddie Gray while in custody of the police, the protests resulted in about 113 police injuries, 486 arrests, and an estimated $9 million in damage to businesses. But while the death of Freddie Gray may have incited this violence, the larger cause may have been the astounding level of inequality in the city of Baltimore. Even in neighborhoods only several miles apart, life circumstances in Baltimore are dramatically different. 17Introduction: Differences in Life ExpectancyThe vast differences across close neighborhoods is immediately apparent. 17Introduction: Differences in Life ExpectancyIn Freddie Gray’s neighborhood of Sandtown-Winchester, the average life expectancy is 67 years; just 3 miles away in the wealthy Baltimore neighborhood of Roland Park, life expectancy averages 84 years. The life expectancy in Freddie Gray’s neighborhood is well below that in North Korea, one of the poorest countries in the world—and at about the same level as the U.S. average in 1948. This is not an isolated example: 15 Baltimore neighborhoods have a life expectancy below that of North Korea.This enormous discrepancy represents huge underlying differences in economic resources in these different neighborhoods. 17Income Distribution and Welfare ProgramsThis dramatic discrepancy in resources raises a central question for public finance. Social welfare may be maximized by redistributing from high-income individuals to low-income individuals, but the private sector is unlikely to provide