Postwar British Economic Growth and the Legacy of Keynes

Thomas Cooley and Lee Ohanian

Journal of Political Economy, 1997, vol. 105, issue 3, 439-72

Abstract: Following John Maynard Keynes's recommendations, Britain taxed capital income at a much higher rate than the United States during the war and for much of the postwar period. This paper presents a quantitative analysis of the policies designed by Keynes using an endogenous growth model and the neoclassical growth model. The implications of tax-smoothing policies are also evaluated. The authors find that the welfare costs of Keynes's policies were very high relative to a tax-smoothing policy and argue that Britain's poor macroeconomic performance in the early postwar period reflects the high tax rates levied on capital income. Copyright 1997 by the University of Chicago.

Date: 1997
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (52)

Downloads: (external link)
http://dx.doi.org/10.1086/262079 full text (application/pdf)
Access to the online full text or PDF requires a subscription.

Related works:
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:ucp:jpolec:v:105:y:1997:i:3:p:439-72

Access Statistics for this article

More articles in Journal of Political Economy from University of Chicago Press
Bibliographic data for series maintained by Journals Division ().