Optimal Taxation: The Design of Child Related Cash- and In-Kind-Benefits

Peter Haan and Katharina Wrohlich

No 737, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: This paper contributes to the debate about the optimal design of tax-transfer systems. Based on the theory of optimal taxation, combined with microsimulation and microeconometric techniques we derive the welfare function which makes the current German tax and transfer system for single women optimal. Furthermore, we compare the welfare function conditional on the presence and age of children and assess how reforms of in-kind childcare transfers would affect the welfare function. This analysis allows us to derive conclusions about the optimal design of child related transfers and in-kind benefits.

Keywords: Optimal taxation; labor supply behavior; transfers for children (search for similar items in EconPapers)
JEL-codes: C23 C25 J22 J64 (search for similar items in EconPapers)
Pages: 27 p.
Date: 2007
New Economics Papers: this item is included in nep-pbe and nep-pub
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Citations: View citations in EconPapers (16)

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https://www.diw.de/documents/publikationen/73/diw_01.c.74205.de/dp737.pdf (application/pdf)

Related works:
Journal Article: Optimal Taxation: The Design of Child‐Related Cash and In‐Kind Benefits (2010)
Journal Article: Optimal Taxation: The Design of Child-Related Cash and In-Kind Benefits (2010)
Working Paper: Optimal Taxation: The Design of Child Related Cash- and In-Kind-Benefits (2007)
Working Paper: Optimal Taxation: The Design of Child Related Cash- and In-Kind-Benefits (2007)
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