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Evaluation of the Effects of Reduced Personal and Corporate Tax Rates on the Growth Rates of the U.S. Economy

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  • Arnold Zellner
  • Jacques K. Ngoie

Abstract

Using several variants of a Marshallian Macroeconomic Model (MMM), see Zellner and Israilevich (2005) and Ngoie and Zellner (2012), this paper investigates how various tax rate reductions may help stimulate the U.S. economy while not adversely affecting aggregate U.S. debt. Variants of our MMM that are shown to fit past data and to perform well […]

Suggested Citation

  • Arnold Zellner & Jacques K. Ngoie, 2012. "Evaluation of the Effects of Reduced Personal and Corporate Tax Rates on the Growth Rates of the U.S. Economy," Working Papers 280, Economic Research Southern Africa.
    • Handle: RePEc:rza:wpaper:280
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    References listed on IDEAS

    as
    1. Giannone, Domenico & Reichlin, Lucrezia, 2009. "Comments on "Forecasting economic and financial variables with global VARs"," International Journal of Forecasting, Elsevier, vol. 25(4), pages 684-686, October.
    2. Marianne Baxter & Robert G. King, 1999. "Measuring Business Cycles: Approximate Band-Pass Filters For Economic Time Series," The Review of Economics and Statistics, MIT Press, vol. 81(4), pages 575-593, November.
    3. William Barnett & Evgeniya Duzhak, 2010. "Empirical assessment of bifurcation regions within New Keynesian models," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 45(1), pages 99-128, October.
    4. Ngoie, Jacques Kibambe & Zellner, Arnold, 2012. "The Use Of A Marshallian Macroeconomic Model For Policy Evaluation: Case Of South Africa," Macroeconomic Dynamics, Cambridge University Press, vol. 16(3), pages 423-448, June.
    5. Barro, Robert J, 1990. "Government Spending in a Simple Model of Endogenous Growth," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 103-126, October.
    6. Zellner, Arnold & Tobias, Justin, 1998. "A Note on Aggregation, Disaggregation and Forecasting Performance," CUDARE Working Papers 198677, University of California, Berkeley, Department of Agricultural and Resource Economics.
    7. Victor Zarnowitz, 1992. "Business Cycles: Theory, History, Indicators, and Forecasting," NBER Books, National Bureau of Economic Research, Inc, number zarn92-1, March.
    8. Zarnowitz, Victor, 1992. "Business Cycles," National Bureau of Economic Research Books, University of Chicago Press, number 9780226978901, December.
    9. Frank Smets & Rafael Wouters, 2007. "Shocks and Frictions in US Business Cycles: A Bayesian DSGE Approach," American Economic Review, American Economic Association, vol. 97(3), pages 586-606, June.
    10. Zellner, Arnold & Israilevich, Guillermo, 2005. "The Marshallian macroeconomic model: A progress report," International Journal of Forecasting, Elsevier, vol. 21(4), pages 627-645.
    11. Zellner,Arnold & Palm,Franz C. (ed.), 2004. "The Structural Econometric Time Series Analysis Approach," Cambridge Books, Cambridge University Press, number 9780521814072.
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    Cited by:

    1. Sayef Bakari & Ali Ahmadi & Sofien Tiba, 2020. "The Nexus among Domestic Investment, Taxation, and Economic Growth in Germany: Cointegration and Vector Error Correction Model Analysis," Journal of Smart Economic Growth, , vol. 5(1), pages 37-47, May.
    2. Dladla, Khumbuzile & Khobai, Hlalefang, 2018. "The impact of Taxation on Economic Growth in South Africa," MPRA Paper 86219, University Library of Munich, Germany.
    3. Keshab Bhattarai & Jonathan Haughton & Michael Head & David G Tuerck, 2017. "Simulating Corporate Income Tax Reform Proposals with a Dynamic CGE Model," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 9(5), pages 20-35, May.
    4. Bournakis, Ioannis & Mallick, Sushanta, 2018. "TFP estimation at firm level: The fiscal aspect of productivity convergence in the UK," Economic Modelling, Elsevier, vol. 70(C), pages 579-590.

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    More about this item

    Keywords

    advanced economies; Consumer Behavior; fiscal policy; Macroeconomic Models; Other Macroeconomic Variables;
    All these keywords.

    JEL classification:

    • E27 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Forecasting and Simulation: Models and Applications

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