@techreport{NBERw18473,
 title = "Non-linear Effects of Taxation on Growth",
 author = "Nir Jaimovich and Sergio Rebelo",
 institution = "National Bureau of Economic Research",
 type = "Working Paper",
 series = "Working Paper Series",
 number = "18473",
 year = "2012",
 month = "October",
 URL = "http://www.nber.org/papers/w18473",
 abstract = {We study a model in which the effects of taxation on growth are highly non-linear. Marginal increases in tax rates have a small growth impact when tax rates are low or moderate. When tax rates are high, further tax hikes have a large, negative impact on growth performance. We argue that this non-linearity is consistent with the empirical evidence on the effect of taxation and other disincentives to investment and innovation on economic growth.},
}