Resource title

Reducing the excess burden of subsidizing the stork: joint taxation, individual taxation, and family tax splitting

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Resource description

Analyzing a homogenous household setting with endogenous fertility and endogenous labor supply, we demonstrate that moving from joint taxation to individual taxation and adapting child benefits so as to keep fertility constant entails a Pareto improvement. The change is associated with an increase in labor supply and consumption and a reduction of the marginal income tax, while the child benefit may move in either direction. Similarly, a move from joint taxation to some scheme of family tax splitting increases labor supply and welfare.

Resource author

Volker Meier, Matthias Wrede

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Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/26515

Resource license

Adapt according to the presented license agreement and reference the original author.