Taxes & marriage

Every good Conservative is in favour of stable marriages and low taxation. But what if the two goals conflict? That's the issue raised in this new paper, which shows that redistributive taxation can help promote marriage. The authors say:

Marriage involves some intra-family redistribution, particularly if the people who marry are very unequal in their income-earning abilities or wealth. This may prevent people with different income from marrying even if their emotional benefits from marrying were large, because the high income earner is concerned too much about sharing his or her income with the respective partner...Taxation reduces the inequality and this makes the emotional rent from marrying more important for the private decisions about whether to marry, and this improves the efficiency properties of marriage decisions.

There's not much romance in economics is there?
However, the benefits of redistributive tax in promoting marriage will depend, in part, upon how partners meet. In a society which is already segregated by income,  the Mills & Boon ideal of the rich man meeting the poor girl just won't happen. In this case, redistributive taxation will have no effect.
However, in a society in which people of different incomes do meet - say because they share similar interests - such taxation will promote marriage.
This raises a question. If we really want to promote marriage (and it is an if), should we really be content  with the silly idea of tax breaks for married couples, or should we also think about the social institutions through which people meet in the first place.

Comments

[reason]

This reminds me of Robert Waldmann's offer to find a neo-classical theoretical construction to match any given prior proposal.

But yes, we should try always to promote the end goal (social stability) and not just the means (traditional marriage). Prescriptive policy is not the right way to go about things.

[MarkCD]

You can make a study to show anything you want. Look at the wacky farce "fairtax" for example.

People will believe almost ANY nonsense, if its fed them in certain ways. SOmething presented by authority figure, that lets them feel part of a group, and gives them something for nothing, is almost irresistable.

Fairtax is a wacked out farce, a mathematically absurdity that pretends to be able to tax the federal government to pay the federal goverment. Its as crazy as any farce ever presented.

But gullible people are buying it.

I hope we actually get the lunatic tax, I would love to watch it.

[cmsd2]

We could tax women more than men.
That would create an artificial imbalance even in the same social circles, which can be compensated for by marriage.

Of course it might not be popular with certain sections of society such as lesbian women.