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Supply-Side Economics of Germany's Year 2000 Tax Reform: A Quantitative Assessment

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  • Holger Strulik

Abstract

The paper provides an assessment of supply-side economics following Germany's year 2000 tax reform. Investigated are a corporate tax cut, deteriorating depreciation allowances and imputation rules, and a private income tax cut. For this purpose, a neoclassical growth model is augmented by various fiscal policy parameters and endogenous corporate finance and calibrated with German data. The model is used to evaluate consequences of Germany's tax reform on production, firm finance and leverage, investment, consumption and welfare of a representative household. Copyright Verein für Socialpolitik and Blackwell Publishing Ltd. 2003.

Suggested Citation

  • Holger Strulik, 2003. "Supply-Side Economics of Germany's Year 2000 Tax Reform: A Quantitative Assessment," German Economic Review, Verein für Socialpolitik, vol. 4(2), pages 183-202, May.
  • Handle: RePEc:bla:germec:v:4:y:2003:i:2:p:183-202
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    References listed on IDEAS

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    Cited by:

    1. Doina Radulescu & Michael Stimmelmayr, 2010. "The welfare loss from differential taxation of sectors in Germany," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 17(2), pages 193-215, April.

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