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The Political Economy of Joint Taxation

Author

Listed:
  • Felix J. Bierbrauer
  • Pierre C. Boyer
  • Andreas Peichl
  • Daniel Weishaar
  • Felix Bierbrauer

Abstract

Joint taxation of married couples represents a puzzle for welfare economics. We investigate whether political economy forces can explain its persistence. We develop sufficient statistics to determine whether a reform towards individual taxation would garner majority support and apply this framework to the U.S. tax system since the 1960s. Our findings indicate that support for individual taxation has increased over time. As of today, 50% of all married individuals would benefit from such a reform. Among those worse off are poor single-earner couples. A reform that reduces marriage bonuses also for them is rejected by a social welfare function that concentrates weights at the bottom of the distribution.

Suggested Citation

  • Felix J. Bierbrauer & Pierre C. Boyer & Andreas Peichl & Daniel Weishaar & Felix Bierbrauer, 2025. "The Political Economy of Joint Taxation," CESifo Working Paper Series 11728, CESifo.
    • Handle: RePEc:ces:ceswps:_11728
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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp11728.pdf
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    More about this item

    Keywords

    taxation of couples; tax reforms; optimal taxation; political economy; non-linear income taxation;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation

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