IDEAS home Printed from https://ideas.repec.org/p/tiu/tiutis/e23ff05d-2802-4c28-9d42-61acb2f21d3d.html
   My bibliography  Save this paper

The working families' tax credit and some European tax reforms in a collective setting

Author

Listed:
  • Bargain, O.
  • Beblo, M.
  • Beninger, D.
  • Blundell, R.
  • Carrasco, R.
  • Chiuri, M-C.
  • Laisney, F.
  • Lechene, V.
  • Longobardi, E.
  • Moreau, N.
  • Myck, M.
  • Ruiz-castillo, J.
  • Vermeulen, F.M.P.

    (Tilburg University, School of Economics and Management)

Abstract

A framework for simplified implementation of the collective model of labor supply decisions is presented in the context of fiscal reforms in the UK. Through its collective form the model accounts for the well known problem of distribution between wallet and purse, a broadly debated issue which has so far been impossible to model due to the limitations of the unitary model of household behavior. A calibrated data set is used to model the effects of introducing two forms of the Working Families’ Tax Credit. We also summarize results of estimations and calibrations obtained using the same methodology on data from five other European countries. The results underline the importance of taking account of the intrahousehold decision process and suggest that who receives government transfers does matter from the point of view of labor supply and welfare of household members. They also highlight the need for more research into models of household behavior. Copyright Springer Science+Business Media, LLC 2006
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Bargain, O. & Beblo, M. & Beninger, D. & Blundell, R. & Carrasco, R. & Chiuri, M-C. & Laisney, F. & Lechene, V. & Longobardi, E. & Moreau, N. & Myck, M. & Ruiz-castillo, J. & Vermeulen, F.M.P., 2006. "The working families' tax credit and some European tax reforms in a collective setting," Other publications TiSEM e23ff05d-2802-4c28-9d42-6, Tilburg University, School of Economics and Management.
  • Handle: RePEc:tiu:tiutis:e23ff05d-2802-4c28-9d42-61acb2f21d3d
    as

    Download full text from publisher

    File URL: https://pure.uvt.nl/ws/portalfiles/portal/782715/REHO2_2Feb.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Richard Blundell & Ian Walker, 1986. "A Life-Cycle Consistent Empirical Model of Family Labour Supply Using Cross-Section Data," Review of Economic Studies, Oxford University Press, vol. 53(4), pages 539-558.
    2. Richard Blundell & Alan Duncan & Julian McCrae & Costas Meghir, 2000. "The labour market impact of the working families’ tax credit," Fiscal Studies, Institute for Fiscal Studies, vol. 21(1), pages 75-103, March.
    3. repec:adr:anecst:y:1993:i:29 is not listed on IDEAS
    4. François Bourguignon & Martin Browning & Pierre-André Chiappori & Valérie Lechene, 1993. "Intra Household Allocation of Consumption: A Model and some Evidence from French Data," Annals of Economics and Statistics, GENES, issue 29, pages 137-156.
    5. Frederic Vermeulen & Olivier Bargain & Miriam Beblo & Denis Beninger & Richard Blundell & Raquel Carrasco & Maria-Concetta Chiuri & François Laisney & Valérie Lechene & Nicolas Moreau & Michal Myck & , 2006. "Collective Models of Labor Supply with Nonconvex Budget Sets and Nonparticipation: A Calibration Approach," Review of Economics of the Household, Springer, vol. 4(2), pages 113-127, June.
    6. Mike Brewer & Tom Clark & Matthew Wakefield, 2002. "Five years of social security reforms in the UK," IFS Working Papers W02/12, Institute for Fiscal Studies.
    7. Richard Blundell & Pierre-André Chiappori & Costas Meghir, 2005. "Collective Labor Supply with Children," Journal of Political Economy, University of Chicago Press, vol. 113(6), pages 1277-1306, December.
    8. Chiappori, Pierre-Andre, 1992. "Collective Labor Supply and Welfare," Journal of Political Economy, University of Chicago Press, vol. 100(3), pages 437-467, June.
    9. Mike Brewer & Tom Clark, 2002. "The impact on incentives of five years of social security reform in the UK," IFS Working Papers W02/14, Institute for Fiscal Studies.
    10. Shelly Lundberg & Robert A. Pollak, 1996. "Bargaining and Distribution in Marriage," Journal of Economic Perspectives, American Economic Association, vol. 10(4), pages 139-158, Fall.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Donni, Olivier & Molina, José Alberto, 2018. "Household Collective Models: Three Decades of Theoretical Contributions and Empirical Evidence," IZA Discussion Papers 11915, Institute of Labor Economics (IZA).
    2. Peter Haan & Michał Myck, 2012. "Multi-family households in a labour supply model: a calibration method with application to Poland," Applied Economics, Taylor & Francis Journals, vol. 44(22), pages 2907-2919, August.
    3. Shun-ichiro Bessho & Masayoshi Hayashi, 2015. "Should the Japanese tax system be more progressive? An evaluation using the simulated SMCFs based on the discrete choice model of labor supply," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 22(1), pages 144-175, February.
    4. Mizuki Komura, 2013. "Tax reform and endogenous gender bargaining power," Review of Economics of the Household, Springer, vol. 11(2), pages 175-192, June.
    5. Pierre-Andre Chiappori & Costas Meghir, 2014. "Intrahousehold Inequality," Cowles Foundation Discussion Papers 1948, Cowles Foundation for Research in Economics, Yale University.
    6. Bautista Lacambra, Sergio, 2020. "Household labor supply: Collective results for certain developed countries," MPRA Paper 101514, University Library of Munich, Germany.
    7. Henk-Wim de Boer & Egbert Jongen & Patrick Koot, 2018. "Optimal Taxation of Secondary Earners in the Netherlands: Has Equity Lost Ground?," CPB Discussion Paper 375.rdf, CPB Netherlands Bureau for Economic Policy Analysis.
    8. Michal Myck & Howard Reed, 2006. "Tax and Benefit Reforms in a Model of Labour Market Transitions," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 75(3), pages 208-239.
    9. Henk-Wim de Boer & Egbert Jongen & Patrick Koot, 2018. "Optimal Taxation of Secondary Earners in the Netherlands: Has Equity Lost Ground?," CPB Discussion Paper 375, CPB Netherlands Bureau for Economic Policy Analysis.
    10. Vidya Atal, 2017. "Say at home, or stay at home? Policy implications on female labor supply and empowerment," Review of Economics of the Household, Springer, vol. 15(4), pages 1081-1103, December.
    11. Anna Kurowska & Michal Myck & Katharina Wrohlich, 2012. "Family and Labor Market Choices: Requirements to Guide Effective Evidence-Based Policy," Discussion Papers of DIW Berlin 1234, DIW Berlin, German Institute for Economic Research.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Olivier Bargain & Miriam Beblo & Denis Beninger & Richard Blundell & Raquel Carrasco & Maria-Concetta Chiuri & François Laisney & Valérie Lechene & Nicolas Moreau & Michal Myck & Javier Ruiz-Castillo , 2006. "Does the Representation of Household Behavior Matter for Welfare Analysis of Tax-benefit Policies? An Introduction," Review of Economics of the Household, Springer, vol. 4(2), pages 99-111, June.
    2. Anna Kurowska & Michal Myck & Katharina Wrohlich, 2012. "Family and Labor Market Choices: Requirements to Guide Effective Evidence-Based Policy," Discussion Papers of DIW Berlin 1234, DIW Berlin, German Institute for Economic Research.
    3. Molina, José Alberto & Gimenez-Nadal, J. Ignacio & Velilla, Jorge, 2018. "Intra-Household Wealth and Welfare Inequality in the US: Estimations from a Collective Model of Labor Supply," IZA Discussion Papers 11707, Institute of Labor Economics (IZA).
    4. Mizuki Komura, 2013. "Tax reform and endogenous gender bargaining power," Review of Economics of the Household, Springer, vol. 11(2), pages 175-192, June.
    5. Chiappori, Pierre-André & Donni, Olivier, 2006. "Les modèles non unitaires de comportement du ménage : un survol de la littérature," L'Actualité Economique, Société Canadienne de Science Economique, vol. 82(1), pages 9-52, mars-juin.
    6. Frederic Vermeulen, 2001. "And the winner is...: an Empirical Evaluation of Two Competing Approaches to Household Labour Supply," Working Papers of Department of Economics, Leuven 500566, KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven.
    7. Donni, Olivier & Molina, José Alberto, 2018. "Household Collective Models: Three Decades of Theoretical Contributions and Empirical Evidence," IZA Discussion Papers 11915, Institute of Labor Economics (IZA).
    8. Lee, Jungmin, 2004. "Observable and Unobservable Household Sharing Rules: Evidence from Young Couples' Pocket Money," IZA Discussion Papers 1250, Institute of Labor Economics (IZA).
    9. Olivier Bargain & Nicolas Moreau, 2003. "Is the Collective Model of Labor Supply Useful for Tax Policy Analysis? A Simulation Exercise," CESifo Working Paper Series 1052, CESifo.
    10. Laurens CHERCHYE & Thomas DEMUYNCK & Bram DE ROCK, 2010. "Noncooperative household consumption with caring," Working Papers of Department of Economics, Leuven ces10.34, KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven.
    11. Richard Blundell & Pierre-Andre Chiappori & Thierry Magnac & Costas Meghir, 2007. "Collective Labour Supply: Heterogeneity and Non-Participation," Review of Economic Studies, Oxford University Press, vol. 74(2), pages 417-445.
    12. Cherchye, Laurens & De Rock, Bram & Vermeulen, Frederic, 2012. "Economic well-being and poverty among the elderly: An analysis based on a collective consumption model," European Economic Review, Elsevier, vol. 56(6), pages 985-1000.
    13. Hans G. Bloemen, 2019. "Collective Labor Supply, Taxes, and Intrahousehold Allocation: An Empirical Approach," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 37(3), pages 471-483, July.
    14. Lee, Jungmin, 2007. "Marriage, the Sharing Rule, and Pocket Money: The Case of South Korea," Economic Development and Cultural Change, University of Chicago Press, vol. 55(3), pages 557-581, April.
    15. Pierre André Chiappori & José Ignacio Gimenez Nadal & José Alberto Molina & Alexandros Theloudis & Jorge Velilla, 2020. "Intrahousehold Commitment and Intertemporal Labor Supply," LISER Working Paper Series 2020-11, LISER.
    16. Olivier Bargain, 2004. "On modeling household labor supply with taxation," DELTA Working Papers 2004-14, DELTA (Ecole normale supérieure).
    17. Olivier Donni, 2004. "La théorie des modèles non coopératifs d'offre de travail et ses applications empiriques," Cahiers de recherche 0409, CIRPEE.
    18. Olivier Donni & Nicolas Moreau, 2007. "Collective Labor Supply: A Single-Equation Model and Some Evidence from French Data," Journal of Human Resources, University of Wisconsin Press, vol. 42(1).
    19. Bloemen, Hans, 2010. "Income Taxation in an Empirical Collective Household Labour Supply Model with Discrete Hours," IZA Discussion Papers 4697, Institute of Labor Economics (IZA).
    20. Olivier Bargain & Nicolas Moreau, 2002. "Is the collective model of labor supply useful for tax policy analysis ? A simulation exercise," DELTA Working Papers 2002-21, DELTA (Ecole normale supérieure).

    More about this item

    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:tiu:tiutis:e23ff05d-2802-4c28-9d42-61acb2f21d3d. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Richard Broekman). General contact details of provider: https://www.tilburguniversity.edu/about/schools/economics-and-management/ .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.