EconPapers    
Economics at your fingertips  
 

SHOULD WE CARE ABOUT THE COMPOSITION OF TAX-BASED STIMULUS PACKAGES?

Kerim Arin (), Peter H. Helles, Murat Koyuncu () and Otto F. M. Reich

Contemporary Economic Policy, 2016, vol. 34, issue 3, 430-445

Abstract: type="main" xml:id="coep12131-abs-0001"> We investigate the effects of tax policy shocks on the U.S. economy over the 1972:3–2008:4 period within a structural vector autoregressive (SVAR) framework. Disaggregating tax shocks suggests that the positive output multipliers documented for total taxes by the previous literature are present only for indirect tax innovations. We also show that both labor and corporate taxes have similar effects on output, with labor tax multipliers being slightly larger in magnitude. The positive and negative responses of inflation following respectively corporate and labor tax shocks imply that former shocks work through aggregate supply, whereas the latter work predominantly through aggregate demand. (JEL C32, E62, H20)

Date: 2016
References: Add references at CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
http://hdl.handle.net/10.1111/coep.2016.34.issue-3 (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Should We Care About the Composition of Tax Based Stimulus Packages? (2010) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:coecpo:v:34:y:2016:i:3:p:430-445

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=1074-3529

Access Statistics for this article

Contemporary Economic Policy is currently edited by Brad R. Humphreys

More articles in Contemporary Economic Policy from Western Economic Association International Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().

 
Page updated 2022-06-10
Handle: RePEc:bla:coecpo:v:34:y:2016:i:3:p:430-445