On the Laffer Effect in Post-Communist Economies: On the Bases of the Observation of Russian Literature
Problems of Economic Transition, Vol. 45, No. 7, pp. 63-81, 2002
19 Pages Posted: 30 Nov 2012
Date Written: November 29, 2012
Originally the Laffer Curve was formulated in a macroeconomic context, for which reason it is not applicable to individual taxes, but rather to a certain average aggregate tax. The 'corrections' to the Laffer Curve are based on a factor of time. High importance is the question – in which direction the average aggregate tax is changing: upward or downward, when the Laffer Effect always appears a couple of years later. Alternatives of the Laffer Curve with 'Hysteresis' are constructed in the article.
Keywords: Laffer Curve, taxes, supply-side economics, hysteresis
JEL Classification: E62, H21, P26, P35
Suggested Citation: Suggested Citation