HRD Candidate name: Alica Bubb

Milestone: Confirmation

Project Title: Essays on the Optimal Taxation of Couples

When: 12.30-2.30pm Thursday 6 May 2021

Where: Zoom - 


This dissertation investigates topics on the taxation of couples. Chapter 1 analyses general non-linear income taxation of couples accounting for part-time employment. I use a unitary household labour supply model with extensive labour supply responses and allow for heterogeneity of primary and secondary earner types in a standard static Mirrleesian framework. Chapter 1 assumes the standard Utilitarian approach to income taxation that is common in the income tax literature.

In Chapter 2, I analyse general non-linear taxation of couples under the alternative normative criteria of equal sacrifice. I propose a proportional equal-sacrifice social welfare function that embodies this normative criteria, and analyse the results under different degrees of assortative matching.

In Chapter 3, I derive the social welfare weights implied by the Australian tax-transfer system by applying the inverse optimal tax approach. As a key novelty, this chapter considers society’s taste for redistribution across single and dual income earner families of different sizes.