... rate increases came during the Reagan administration in 1982. Seeking ways to
stimulate the economy and encourage growth in investment, President Reagan
proposed in the Economic Recovery Tax Act (ERTA) of 1981 the reduction of the top
tax rates by almost 30 percent, from 70 to 50%- and all other tax ...
... Tax cuts can influence growth in two ways: The first is by giving money to consumers who will
spend more in the near term. The second is by enhancing incentives to work, invest, and save
over the medium term.
Think of the excessive tax rates in Canada as a hangover from the battle against deficits a ...
... b. But inflation led to higher tax brackets and
c. Congress continued deficit spending, driving up interest rates
1. Cut social welfare spending and tax cuts (shifted tax burden from income to Social
Security, helping rich and hurting poor)
2. Supply Side Economics and the trickle dow ...
... not taken place), even taking into account any stimulative effect the tax cuts
may have had and any resulting revenue feedback effects. 
... A. Both the deficit and the balanced budget have led to policy debates.
1. Republicans wanted to return the 1999 surplus to the public, while Democrats
wanted to use it for new programs.
2. Both goals were served
a) Republicans: Economic Growth and Tax Relief Reconciliation Act of
2001, one of only ...
Thomas A. Barthold, "How Economics Can Inform Tax Policy
... • In addition to using resources to pay a tax,
market participants lose value from making
choices they would not have made in the
absence of the tax. The new choice is always
inferior to the pre-tax choice.
• Economic burden is the sum of resources
transferred to the government and the value of
... (B) At a price of $250, a shortage of health services will occur. X* will now be only 150.
... (e) Solve for the optimal labor land earnings z = wl choice for an individual with
wage w. Show that there are three cases depending on whether the individual
is in the bottom bracket, the top bracket, or earn exactly z̄.
(f) Explain how the amount of bunching observed at z̄ is related to the elasti ...
Introductory remarks on S. 681 by Senator Obama
... testimony from the owner of a Cayman Island offshore bank who estimated that all of his clients-100 percent--were engaged in tax evasion, and 95 percent were U.S. citizens. In 2000, the Enron
Corporation--remember Enron?--established over 441 offshore entities in the Cayman Islands. A
2004 report fo ...
Dias nummer 1
... Laffer-effects may occur for some groups and some types of
So could tax cuts be self-financing after all?
Mind the words of John Maynard Keynes: ”Nor should the
argument seem strange that taxation may be so high as to
defeat its object, and that, given sufficient time to gather the
fruits, a ...
Falling Off the Fiscal Cliff - Economic Letter, Dec. 2012
... tax cut may have troubling implications for the solvency of entitlement
programs such as Social Security over
the longer term. Extending the labormarket support package would cost
$115 billion in fiscal 2013.
The fourth category includes tax
increases adopted under the Affordable
Care Act of 2010. P ...
... Leads to decrease in quantity.
Consumers pay more, monopolist nets less.
Despite its power, monopolists can suffer from
... Unless agreement expressly contemplates it
PROGRESSIVE TAX RATE VERSUS FLAT INCOME TAX
... a threshold previously set. Thus the global income is taxed only once.
As you can see from the above information, although the flat
income tax is not a universal cure to the economic weaknesses of a
state, a number of European countries, including several EU member
states have introduced the regime ...
Tax Reform Sept 19 2008
... ”The evidence presented in this paper supports the basic theoretical presumption
that state and local governments cannot redistribute income. Since individuals can
avoid unfavorable taxes by migrating to jurisdictions that offer more favorable tax
conditions, a relatively unfavorable tax will cause ...
Chapter 8 Application
... ANSWER: Economists who believe that the deadweight loss of the tax on labor is small argue that
labor supply is fairly inelastic because most people would work full-time regardless of the wage;
hence, the labor supply curve is almost vertical, and a tax on labor has a small deadweight loss.
THE MIDDLE-CLASS SQUEEZE: DC`s Tax System Falls Most
... Families in the District with incomes of $20,000 to $60,000 pay one-tenth of their incomes in
DC property, sales, and income taxes, according to a new study by the Institute on Taxation &
Economic Policy.1 This is much higher than the share of income the city’s richest families pay in
DC taxes. The ...
... i. All agents gain from trade, although these gains are not
ii. Inequality of relative revenues and utilities is higher in an open
economy than in autarky given that some agents do not
iii. Falling trade costs first increase and then decrease inequality.
• Replica ...
Land Taxation in New York City: A General Equilibrium Analysis
... A key determinant of the response of the city's public and private economies to the
elimination of distortionary taxation is the response of city residents (and potential residents) to
changes in land prices (Nechyba 1998). In both the firm (eq. (4)) and household (eq. (5))
specifications adopted he ...
Economic policy of the George W. Bush administration
The economic policy of the George W. Bush administration was a combination of tax cuts, expenditures for fighting two wars, and a free-market ideology intended to de-emphasize the role of government in the private sector. He advocated the ownership society, premised on the concepts of individual accountability, less government, and the owning of property.During his first term (2001–2005), he sought and obtained Congressional approval for tax cuts: the Economic Growth and Tax Relief Reconciliation Act of 2001, the Job Creation and Worker Assistance Act of 2002 and the Jobs and Growth Tax Relief Reconciliation Act of 2003. These acts decreased all tax rates, reduced the capital gains tax, increased the child tax credit and eliminated the so-called ""marriage penalty"", and were set to expire in 2011.The last two years of his presidency were characterized by the worsening subprime mortgage crisis, which resulted in government intervention to bail out damaged financial institutions and a weakening economy.The U.S. national debt grew significantly from 2001 to 2009, both in dollar terms and relative to the size of the economy (GDP), due to a combination of tax cuts and wars in both Afghanistan and Iraq. Budgeted spending under President Bush averaged 19.9% of GDP, similar to his predecessor President Bill Clinton, although tax receipts were lower at 17.9% versus 19.1%.