How far are we from the slippery slope? : the Laffer curve revisited

by Mathias Trabandt and Harald Uhlig

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. - Laffer curve ; incentives ; dynamic scoring ; US and EU-14 economy

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Year of publication:	2010
Authors:	Trabandt, Mathias ; Uhlig, Harald
Publisher:	Frankfurt am Main : European Central Bank
Subject:	Steuerpolitik \| Tax policy \| Steuerbelastung \| Tax burden \| Arbeit \| Labour \| Kapital \| Capital \| Laffer-Kurve \| Laffer curve \| Neoklassische Theorie \| Neoclassical economics \| Steuersenkung \| Tax cut \| Theorie \| Theory \| EU-Staaten \| EU countries \| USA \| United States

Extent:	Online-Ressource, (57 S., 1,17 MB)
Series:	Working paper series / European Central Bank. - Frankfurt, M. : European Central Bank, ISSN 1725-2806, ZDB-ID 2123559-4. - Vol. 1174
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Arbeitspapier ; Working Paper ; Graue Literatur ; Non-commercial literature
Language:	English
Other identifiers:	hdl:10419/153608 [Handle]
Classification:	E0 - Macroeconomics and Monetary Economics. General ; E60 - Macroeconomic Policy Formation, Macroeconomic Aspects of Public Finance, Macroeconomic Policy, and General Outlook. General ; H0 - Public Economics. General
Source:	ECONIS - Online Catalogue of the ZBW

Persistent link: https://www.econbiz.de/10003972665