International Tax and Public Finance

, Volume 20, Issue 4, pp 653–686 | Cite as

Gender-based and couple-based taxation

  • Spencer Bastani


In this paper, I explore the optimal taxation of singles and couples in an economy with bargaining couples. The government is concerned with the redistribution of income from individuals with high utility to individuals with low utility, recognizing that some individuals live in couple households where resources are unevenly distributed. I analyze how redistributive linear income taxes, which depend on either gender or household composition (or both) impact the distribution of utility within and across households. An interesting implication arising from the interaction between the model elements is that even though between-group lump-sum transfers always favor women, when the bargaining power of men is high, women are subject to a higher tax rate; this in contrast to previous analyses of gender-based taxation. My quantitative analysis demonstrates that the welfare effects of gender-based taxation are sizable and even larger when taxes depend on the composition of the household.


Optimal taxation Tagging Intra-household bargaining 

JEL Classification

H21 D13 J16 



I am grateful to Dan Anderberg, Ted Bergstrom, Sören Blomquist, Robin Boadway, John Conley, Vidar Christiansen, Luca Micheletto, Eva Mörk, Katarina Nordblom, Ray Rees, Casey Rothschild, Håkan Selin and Laurent Simula, as well as seminar participants in Uppsala and Oslo, and at the IIPF Conference in Dresden and the NTA Conference in Providence for helpful comments and suggestions. Financial support from Riksbankens Jubileumsfond and the Jan Wallander and Tom Hedelius Foundation is gratefully acknowledged.

Supplementary material

10797_2013_9285_MOESM1_ESM.pdf (158 kb)
(PDF 158 kB)


  1. Alesina, A., Ichino, A., & Karabarbounis, L. (2011). Gender-based taxation and the division of family chores. American Economic Journal: Economic Policy, 3(2), 1–40. CrossRefGoogle Scholar
  2. Anderberg, D. (2008). Tax credits income support, and couple decisions. International Tax and Public Finance, 15, 499–526. CrossRefGoogle Scholar
  3. Apps, P. F., & Rees, R. (1997). Collective labor supply and household production. Journal of Political Economy, 105(1), 178–190. CrossRefGoogle Scholar
  4. Apps, P. F., & Rees, R. (2011). Optimal taxation and tax reform for two-earner households. CESifo Economic Studies, 57, 283–304. CrossRefGoogle Scholar
  5. Atkinson, A. B., & Stiglitz, J. (1980). Lectures in public economics. New York: McGraw-Hill. Google Scholar
  6. Bastani, S., Blomquist, S., & Micheletto, L. (2013). The welfare gains of age-related optimal income taxation. International Economic Review (forthcoming). Google Scholar
  7. Bergstrom, T. C. (1996). Economics in a family way. Journal of Economic Literature, 34(4), 1903–1934. Google Scholar
  8. Blomquist, S., & Micheletto, L. (2008). Age-related optimal income taxation. Scandinavian Journal of Economics, 110(1), 45–71. CrossRefGoogle Scholar
  9. Blundell, R., & MaCurdy, T. (1999). Labor supply: a review of alternative approaches. In O. Ashenfelter & D. Card (Eds.), Handbook of labor economics, Amsterdam: Elsevier. Google Scholar
  10. Blundell, R., & Shephard, A. (2012). Employment, hours of work and the optimal taxation of low income families. Review of Economic Studies, 79(2), 481–510. CrossRefGoogle Scholar
  11. Boadway, R., & Pestieau, P. (2006). Tagging and redistributive taxation. Annales d’Économie et de Statistique, 83–84, 123–147. Google Scholar
  12. Boskin, M. J., & Sheshinski, E. (1983). Optimal tax treatment of the family: married couples. Journal of Public Economics, 20, 281–297. CrossRefGoogle Scholar
  13. Brett, C. (2007). Optimal nonlinear taxes for families. International Tax and Public Finance, 14(3), 225–261. CrossRefGoogle Scholar
  14. Browning, M., Chiappori, P. A., & Lewbel, A. (2004). Estimating consumption economies of scale, adult equivalence scales, and household bargaining power. Working paper 588, Boston College. Google Scholar
  15. Cherchye, L., Muynck, T. D., & DeRock, B. (2011). Noncooperative household consumption with caring. Working paper, Tilburg University. Google Scholar
  16. Chiappori, P.-A. D. (2009). Non-unitary models of household behavior: a survey of the literature. IZA discussion paper 4603, Institute for the Study of Labor (IZA). Google Scholar
  17. Cremer, H., Gahvari, F., & Lozachmeur, J. M. (2010). Tagging and income taxation: theory and an application. American Economic Journal: Economic Policy, 2(1), 31–50. CrossRefGoogle Scholar
  18. Einav, L., Finkelstein, A., & Schrimpf, P. (2010). Optimal mandates and the welfare cost of asymmetric information: evidence from the U.K. annuity market. Econometrica, 78, 1031–1092. CrossRefGoogle Scholar
  19. Gronau, R. (1977). Leisure, home production and work—the theory of the allocation of time revisited. Journal of Political Economy, 85, 1099–1123. CrossRefGoogle Scholar
  20. Gruber, J. (2004). Is making divorce easier bad for children? The long-run implications of unilateral divorce. Journal of Labor Economics, 22(4), 799–833. CrossRefGoogle Scholar
  21. Immonen, R., Kanbur, R., Keen, M., & Tuomala, M. (1998). Tagging and taxing: the use of categorical and income information in designing tax/transfer schemes. Economica, 65, 179–192. CrossRefGoogle Scholar
  22. Kleven, H. J., Kreiner, C. T., & Saez, E. (2009). The optimal income taxation of couples. Econometrica, 77(2), 537–560. CrossRefGoogle Scholar
  23. Lewbel, A., & Pendakur, K. (2008). Estimation of collective household models with Engel curves. Journal of Econometrics, 147(2), 350–358. CrossRefGoogle Scholar
  24. Lise, J., & Seitz, S. (2011). Consumption inequality and intra-household allocations. Review of Economic Studies, 78, 328–355. CrossRefGoogle Scholar
  25. Lundberg, S. J., & Pollak, R. A. (1993). Separate spheres bargaining and the marriage market. Journal of Political Economy, 101, 988–1010. CrossRefGoogle Scholar
  26. Lundberg, S. J., & Pollak, R. A. (1996). Bargaining and distribution in marriage. The Journal of Economic Perspectives, 10, 139–158. CrossRefGoogle Scholar
  27. Mankiw, N. G., & Weinzierl, M. (2010). The optimal taxation of height: a case study of utilitarian income redistribution. American Economic Journal: Economic Policy, 2(1), 155–176. CrossRefGoogle Scholar
  28. Manser, M., & Brown, M. (1980). Marriage and household decision-making: a bargaining analysis. International Economic Review, 21, 31–44. CrossRefGoogle Scholar
  29. McElroy, M. B., & Horney, M. J. (1981). Nash-bargained household decisions: toward a generalization of the theory of demand. International Economic Review, 22, 333–349. CrossRefGoogle Scholar
  30. Muthoo, A. (1999). Bargaining theory with applications. Cambridge: Cambridge University Press. Google Scholar
  31. Peichl, A. (2012). The world is flat: existing tax benefit systems approximate a linear one. Mimeo. Google Scholar
  32. Rosen, H. S. (1977). Is it time to abandon joint filing? National Tax Journal, 30(4), 423–428. Google Scholar
  33. Saez, E. (2001). Using elasticities to derive optimal income tax rates. Review of Economic Studies, 68, 205–229. CrossRefGoogle Scholar
  34. Sheshinski, E. (1972). The optimal linear income tax. Review of Economic Studies, 39, 297–302. CrossRefGoogle Scholar
  35. Stern, N. H. (1976). On the specification of models of optimum income taxation. Journal of Public Economics, 6, 123–162. CrossRefGoogle Scholar
  36. Viard, A. D. (2001). Optimal categorical transfer payments: the welfare economics of limited lump-sum redistribution. Journal of Public Economic Theory, 3(4), 483–500. CrossRefGoogle Scholar
  37. Weinzierl, M. C. (2011). The surprising power of age-dependent taxes. Review of Economic Studies, 78(4), 1490–1518. CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media New York 2013

Authors and Affiliations

  1. 1.Department of EconomicsUppsala UniversityUppsalaSweden

Personalised recommendations