Why Do Spouses Hide Income?

This paper proposes a simpli\u85ed model of intrahousehold decision making where co-operative and noncooperative behavior are not mutually exclusive. Individuals choose the optimal share of income they wish to devote towards cooperation, where income is pooled and allocated collectively, and towards noncooperation, where income is al-located independently. Using the example of joint saving as an area of household cooperation, this model shows how limited autonomy and bargaining power can inter-act to create incentives for individuals to hide income. This result provides theoretical support for the call to collect survey data separately from individuals rather than from household representatives. I