Analyzing these categories is important for understanding country-level patterns. For the fiscal incidence analysis, a single household classification system should be created by combining the economic and care categories.<sup>24</sup> That is because tax and transfer policies condition _simultaneously_ all of the economic and care activities that households and household members pursue. For example, personal income tax policy will determine how many household members will spend time in paid employment (as well as how long each member will spend in paid employment), how many dependents from each age bracket can be supported from wage earnings, and how much time each household member will spend on social reproduction activities.

Table 1 illustrates the advantages and disadvantages of each of these categories from a fiscal incidence perspective in the context of Armenia.<sup>25</sup> Beginning with Type 2 (T2) households, the needs and opportunities of individual household members shape household organization and the incentives informing choices and behaviors at home, in the labor market, and in markets for goods and services. T2 categorizes households according to the contributions (to household income) of individual male and female members, while T3 assumes that not all household earners have equal contributions or bargaining power within households. T4 implicitly identifies the presence of children and the elderly to capture the household’s care needs and domestic responsibilities, and their interaction with incomes and labor decisions. While initially the demographic and employment categories can be studied separately, the fiscal incidence analysis would ideally be performed on the integrated employment/care category (see T4 in the last column of Table 1).

Table 1. Household Typology, Armenia

||(T1) Demographic<br>composition|(T2) Income<br>contributions|(T3) Gender-shares<br>of HH earnings|(T4) Mixed typology|
|---|---|---|---|---|
|Types|Femalemajority<br>or male majority<br>(or equal numbers)<br>of household<br>members|Earners are a<br>femalemajority,<br>Earners are a male<br>majority,equal<br>number of male<br>and female earners|Female earnings >60%<br>of total earnings,<br>male earnings >60%<br>of total earnings,<br>No earners|Earners are female<br>majority + dependent<br>children + dependent<br>elderly, Earners are male<br>majority + dependent<br>children + dependent<br>elderly|
|Usefulness/<br>relevance<br>for gender<br>analysis|Exploits variation in<br>consumptionpatterns<br>and gender-specific<br>demands or needs|Introduces<br>women’seconomic<br>opportunities and<br>householdroles|Exploits variation in<br>bargainingpower|Captures care needs and<br>domestic responsibilities,<br>and interaction with<br>incomes and labor<br>decisions|

_Source:_ Based on Fuchs and Gonzalez (2022).

> 24. In some countries, like Jordan, the cell sizes for a combined economic/demographic classification may be too small for a fiscal incidence analysis. In this case, the analyst will need to make choices about which classifications make most sense in any particular country context (see Rodriguez, Wai-Poi, and Woodham 2022).

> 25. A household type defined by household headship is included in Fuchs and Gonzalez (2022). However, Grown and Komatsu (2010) discuss the lack of relevant information in standard household survey techniques that ask household members to identify the head of household.

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