How Far are We from the Slippery Slope? The Laffer Curve Revisited
59 Pages Posted: 22 Apr 2010
There are 5 versions of this paper
How Far are We from the Slippery Slope? The Laffer Curve Revisited
How Far are We from the Slippery Slope? The Laffer Curve Revisited
How Far are We from the Slippery Slope? The Laffer Curve Revisited
How Far are We from the Slippery Slope? The Laffer Curve Revisited
How Far are We from the Slippery Slope? The Laffer Curve Revisited
Date Written: April 1, 2010
Abstract
We characterize the Laffer curves for labor taxation and capital income taxation quantitatively for the US, the EU-14 and individual European countries by comparing the balanced growth paths of a neoclassical growth model featuring "constant Frisch elasticity" (CFE) preferences. We derive properties of CFE preferences. We provide new tax rate data. For benchmark parameters, we find that the US can increase tax revenues by 30% by raising labor taxes and 6% by raising capital income taxes. For the EU-14 we obtain 8% and 1%. Denmark and Sweden are on the wrong side of the Laffer curve for capital income taxation.
Keywords: Laffer Curve, Incentives, Dynamic Scoring, US and EU-14 Economy
JEL Classification: E0, E60, H0
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
How Far are We from the Slippery Slope? The Laffer Curve Revisited
By Harald Uhlig and Mathias Trabandt
-
How Far are We from the Slippery Slope? The Laffer Curve Revisited
By Harald Uhlig and Mathias Trabandt
-
How Far are We from the Slippery Slope? The Laffer Curve Revisited
By Mathias Trabandt and Harald Uhlig
-
How Far are We from the Slippery Slope? The Laffer Curve Revisited
By Harald Uhlig and Mathias Trabandt
-
Dynamic Scoring: Alternative Financing Schemes
By Eric M. Leeper and Shu-chun S. Yang
-
Dynamic Scoring: Alternative Financing Schemes
By Eric M. Leeper and Shu-chun S. Yang
-
Beyond GDP? Welfare Across Countries and Time
By Charles I. Jones and Peter J. Klenow