Dynamic Scoring: A Back-of-the-Envelope Guide,
NBER Working Paper No. 11000 This paper uses the neoclassical growth model to examine the extent to which a tax cut pays for itself through higher economic growth. The model yields simple expressions for the steady-state feedback effect of a tax cut. The feedback is surprisingly large: for standard parameter values, half of a capital tax cut is self-financing. The paper considers various generalizations of the basic model, including elastic labor supply departures from infinite horizons, and non-neoclassical production settings. It also examines how the steady-state results are modified when one considers the transition path to the steady state.
A non-technical summary of this paper is available in the July 2005 NBER Digest.
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Machine-readable bibliographic record - MARC, RIS, BibTeX Document Object Identifier (DOI): 10.3386/w11000 Published: Mankiw, N. Gregory and Matthew Weinzierl. "Dynamic Scoring: A Back-of-the-Envelope Guide," Journal of Public Economics, 2006, v90(8-9,Sep), 1415-1433. citation courtesy of Users who downloaded this paper also downloaded* these:
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