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Monday, December 03, 2012

'Lessons from a Half Century of Federal Individual Income Tax Changes'

Owen Zidar:
... I find that heterogeneity is quite important, that almost all of the stimulative effect of tax cuts results from tax cuts for the bottom 90%, and that there is no substantial link between tax cuts for the top 10% and subsequent job creation. The notion that raising top rates slightly leads to substantially lower job creation and economic growth has no empirical support from the last half century...

If only evidence mattered. He also has an interesting chart:

Taxburden[1]Negative entries are tax cuts, and positive entries are tax increases (as he notes, this is federal income tax only, payroll tax changes follow a different pattern). The light blue line is the top 20%.

    Posted by on Monday, December 3, 2012 at 11:10 AM Permalink  Comments (10)


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