Title: Dynamic scoring
Subtitle: a back-of-the-envelope guide
First published: 2004
Description: "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"--National Bureau of Economic Research web site.
Subjects: Taxation, Economic development, Econometric models
LC classification: HB1