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Taxation and Laffer Effects on Employment and Growth

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  • Silvia Fedeli

    (Sapienza – University of Rome)

Abstract

Some dangerous short- and long-term ambiguities of fiscal policies arise from the belief that Laffer effects may be generated from deficit-financed tax cuts able to stimulate aggregate demand. However, even in a supply-side framework, fiscal illusion prevents a rational perception of the effectiveness of Laffer-oriented fiscal measures. The ambiguity of the Laffer effect led to an important series of studies of Francesco Forte, designed to disclose and empirically test its interactions with short- and long-term fiscal policies on gross domestic product (GDP) growth and on other relevant macroeconomic variables. We discuss, under the Laffer perspective, some of Francesco Forte’s studies related to fiscal policy effects on the labour market and GDP growth.

Suggested Citation

  • Silvia Fedeli, 2017. "Taxation and Laffer Effects on Employment and Growth," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 23(1), pages 1-7, February.
  • Handle: RePEc:kap:iaecre:v:23:y:2017:i:1:d:10.1007_s11294-016-9618-4
    DOI: 10.1007/s11294-016-9618-4
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    References listed on IDEAS

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    1. Monissen, Hans G., 1999. "Explorations of the Laffer curve," W.E.P. - Würzburg Economic Papers 9, University of Würzburg, Department of Economics.
    2. Silvia Fedeli & Francesco Forte, 2009. "The Laffer effects of a program of deregulation cum detaxation: the Italian reform of labour contracts in the period 1997–2001," European Journal of Law and Economics, Springer, vol. 27(3), pages 211-232, June.
    3. Brennan,Geoffrey & Buchanan,James M., 2006. "The Power to Tax," Cambridge Books, Cambridge University Press, number 9780521027922.
    4. Francesco Forte & Ram Mudambi & Pietro Maria Navarra (ed.), 2014. "A Handbook of Alternative Theories of Public Economics," Books, Edward Elgar Publishing, number 14898.
    5. Silvia Fedeli & Francesco Forte, 2014. "Deficits, tax burden and unemployment," Chapters, in: Francesco Forte & Ram Mudambi & Pietro Maria Navarra (ed.), A Handbook of Alternative Theories of Public Economics, chapter 5, pages 116-140, Edward Elgar Publishing.
    6. Silvia Fedeli & Francesco Forte & Ernesto Zangari, 2008. "An Econometric Analysis of the Employment and Revenue Effects of the Treu Reform in the Period 1997-2001," Rivista di Politica Economica, SIPI Spa, vol. 98(1), pages 215-248, January-F.
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