Capital Taxation During the U.S. Great Depression
AbstractPrevious studies of the U.S. Great Depression find that increased government spending and taxation contributed little to either the dramatic downturn or the slow recovery. These studies include only one type of capital taxation: a business profits tax. The contribution is much greater when the analysis includes other types of capital taxes. A general equilibrium model extended to include taxes on dividends, property, capital stock, excess profits, and undistributed profits predicts patterns of output, investment, and hours worked that are more like those in the 1930s than found in earlier studies. The greatest effects come from the increased taxes on corporate dividends and undistributed profits. JEL Codes: E13, E32, H25 Copyright 2012, Oxford University Press.
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Bibliographic InfoArticle provided by Oxford University Press in its journal The Quarterly Journal of Economics.
Volume (Year): 127 (2012)
Issue (Month): 3 ()
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Other versions of this item:
- Ellen R. McGrattan, 2010. "Capital taxation during the U.S. Great Depression," Staff Report 451, Federal Reserve Bank of Minneapolis.
- Ellen R. McGrattan, 2010. "Capital taxation during the U.S. Great Depression," Working Papers 670, Federal Reserve Bank of Minneapolis.
- Ellen R. McGrattan, 2010. "Capital Taxation During the U.S. Great Depression," NBER Working Papers 16588, National Bureau of Economic Research, Inc.
- E13 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Neoclassical
- E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
- H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
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