Preannounced Tax Cuts and Their Potential Influence on the 2001 Recession

Butters, R. Andrew; Veracierto, Marcelo

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Preannounced Tax Cuts and Their Potential Influence on the 2001 Recession

Economic Perspectives, Vol. 33, No. 3, 2009

16 Pages Posted: 15 Oct 2009

See all articles by R. Andrew Butters

Marcelo Veracierto

Federal Reserve Bank of Chicago - Research Department

Date Written: October 15, 2009

Abstract

The authors present a model in which anticipated future tax cuts, like those promised during the 2000 U.S. presidential campaign, generate a contraction in economic activity with some of the atypical features observed during the 2001 recession (such as its relatively strong consumption and home investment).

Suggested Citation: Suggested Citation

Butters, R. and Veracierto, Marcelo, Preannounced Tax Cuts and Their Potential Influence on the 2001 Recession (October 15, 2009). Economic Perspectives, Vol. 33, No. 3, 2009, Available at SSRN: https://ssrn.com/abstract=1489490