Over the last decade a number of countries, notably the USA, theUK and Australia, have introduced new tax and welfare programs,or expanded existing programs, that have the effect of raising taxrates on the income of the second earner in the family. Examplesinclude the earned income tax credit...

In this paper Peter Dawkins argues for the "wage-tax trade-off" proposed by the "Five Economists" as part of their policy package for reducing unemployment. As he explains, the trade-off involves using an earned income tax credit (EITC) scheme "as a way of increasing the incomes of low-wage...