Taxing men

It's not just looks and height that should be taxed. So too should having meat and two veg, according to this paper (pdf, via CEPR).
The thinking here is based on an old, well-established theory - Frank Ramsey's "inverse elasticity" rule. This says that taxes should be lightest on those goods which are most price elastic. And women's labour supply is more price-elastic than men's. Men will go out to work (or not) more or less come what may. But some women, at the margin, can choose between being a home-maker or going out to work. This choice means their labour supply is more responsive to tax rates than men's. Which in turn means that shifting tax from women to men might raise labour supply and hence output.
But that's not all. If women go out to work more, men will have to share the housework and childcare more. Is this efficient?
If you believe in diminishing returns, yes. The first hour a man spends looking after the kids should be better quality than the 50th hour a frazzled mum spends with them.
But this isn't necessarily so. Some men might be so bad at childcare that children are better off with their mother. In such cases, incentives for women to go out to work would backfire.
All this raises the question. If there is, in theory, something to be said for taxing height, gender, or looks, why does the government never even consider these possibilities? It can't be because such schemes are complicated; the existence of the tax credit system shows the government doesn't value simplicity highly. Could it be that the government taxes income for the same reason Willie Sutton robbed banks - because that's where the money is?

Comments

[Jock]

Only if one insists on taxing labour. Land wold be better.

[John Gibson]

Yes, but this is only using the criterion of Ramsey's "optimal tax theory", and there are many other relevant criteria which it doesn't address. Plus, of course, it is completely neutered and blind on the issue of the size of the public sector ... I betcha that 25% tax/GDP sub-optimal a la Ramsey is a lot better than 35% tax/GDP Ramsey-optimal. Still, I suppose it gave the authors ample opportunity to show how clever they are.

[Dave Cole]

"Some men might be so bad at childcare that children are better off with their mother. In such cases, incentives for women to go out to work would backfire."

Cole's corollary to Dillow's dictum:

Some women might be so bad at childcare that children are better off with their mother. In such cases, incentives for men to go out to work would backfire.

[james c]

You are confusing the taxation of immuatable characteristics (height and looks) with the application of a different rate of taxation on income for men and women.

The two ideas are completely different.

The first is based on equity (you tell us that short, ugly people have less fun so lets give them more money), whilst the second is based on efficiency (taxation distorts the choice of mothers to work or care for their children).

[jameshigham]

I understand that they're planning to tax more than two children now. Why stop thee? Why not tax windows or bring in the poll tax again?

[dearieme]

It would stop all the tedious lying about height.