FAMILY POLICY WITH NONCOOPERATIVE FAMILIES

We consider a non-cooperative model of a Family's time allocation betw een market work and providing a home-produced family public good (such as child care or care For the elderly). The model predicts underprovi sion of the public good. Because of crowding out, this does not necess arily warrant public provision. In contrast to other approaches in fam ily economics, we find that attempts to redistribute between spouses m ay alter the final distribution within the marriage, and that such a p olicy may be Pareto improving. We also find that some degree of progre ssivity of the income tax can be welfare improving.