In comments to my previous post, Robert requested the unsmoothed data from Graph 3.  Here it is.   GPDI is plotted against the Capital Gains Tax Rate. Since the Capital Gains Tax Rate (X-axis) is quantized, the result is columns of data.  Compared to the smoothed version, there is little change in either the slope or […]

Matt Yglesias, servitor to our corporate overlords, suggests that the reduced capital gains tax rate paid by rentiers like Willard Romney is really a very, very good thing.  To wit: The main reason Romney’s effective rate is so low is that the American tax code contains a lot of preferences for investment income over labor […]

Euro Area Retail Sales Portend Negative Quarter of Real Consumption by Rebecca Wilder Today Eurostat released its June estimate of real retail sales for the Euro area. On a month/month basis, real retail sales increased at a rate of 0.1%. However, on a trended basis, the 3-month/3-month average growth rate was down 0.7% in the […]

by Rebecca Wilder Is Ireland the Poster Child of Growth? I wanted to familiarize myself with the economic statistics in Ireland, so I thought that I’d share my findings with you all. Many politicians refer to Ireland as the poster child of austerity – according to the contentious thesis of expansionary austerity (a review from the […]

by Mike Kimel American Enterprise Institute Economists Redux The other day I wrote a post about economists at the American Enterprise Institute (AEI), a prominent conservative think-tank. The post began with this paragraph from a story in the NY Times Politicians sometimes say that lower tax rates lead to higher economic growth, which in turn […]

by Mike Kimel Explaining Why Low Tax Rates are Correlated with Slower Economic Growth, Once Again One of the regular mysteries facing economists is why the US economy fails to display evidence of a relationship that everyone seems to accept implicitly, namely that lower taxes lead to (or even are correlated with) faster economic growth. […]

Tim Duy body-slams St. Louis FRB President James Bullard: Estimates of potential GDP are not simple extrapolations of actual GDP from the peak of the last business cycles. They are estimates of the maximum sustainable output given fully employed resources. The backbone of the CBO’s estimates is a Solow Growth model. So I don’t think […]

by Mike Kimel A Modest Forecast: The Average Real Growth in Ireland will Exceed 10% a Year From 2012 to 2014  You read the title correctly: the Irish economy will grow by more than 10% next year. Now, hearing that, you might be asking yourself: “Is this guy for real? He must be nuts.”  Because […]

by Mike Kimel In this post, I will show that during the New Deal era, changes in the real economic growth rate can be explained almost entirely by the earlier changes in federal government’s non-defense spending. There are going to be a lot of words at first – but if you’re the impatient type, feel […]

by >Mike Kimel I’ve been writing about the relationship between tax rates and growth since I started blogging in 2006. A lot of those posts have focused on the quadratic relationship between tax rates and growth. That is, it turns out that if you take US data going back to when the BEA started keeping […]