Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/309455 
Year of Publication: 
2023
Citation: 
[Journal:] Journal of Family and Economic Issues [ISSN:] 1573-3475 [Volume:] 45 [Issue:] 3 [Publisher:] Springer US [Place:] New York, NY [Year:] 2023 [Pages:] 687-719
Publisher: 
Springer US, New York, NY
Abstract: 
Whether couples pool their resources and behave like a unit or spend their income individually is crucial for social and tax policy. In this paper, I provide a test of the income pooling hypothesis using administrative cross-sectional survey data on expenditures and individual incomes of couple households in Germany. The test is performed within the quadratic almost ideal demand system framework, which allows for an endogenous expenditure budget and endogenous individual income contribution shares in an instrumental variables approach. Although perfect income pooling is broadly rejected, there are significant differences regarding the marital status, the presence of at least one child in the household and whether the household is located in a former West or East German federal state. Married and unmarried couples with children are closer to the acceptance of the hypothesis than couples without children. The approach allows to calculate justifiable differentials of the marginal tax rates within the household if income pooling is rejected.
Subjects: 
Income Pooling
Intra-Household Allocation
Income Taxation
QUAIDS
JEL: 
D12
D13
H24
J12
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article
Document Version: 
Published Version

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