As an econ major with a BS, please don’t lump me in with the econ majors who went to business school for a MBA. I like cool math, not venture capitalism cancer.
The only thing funny about the Laffer curve is how little it now matters.
It was used to justify Reagnomics, which then immediately proved we weren’t nearly as high on the Laffer curve as we assumed. Because of this, we have concrete evidence that lowering taxes on the rich doesn’t increase government revenues.
Yet we’re still doing that 50 years later. Despite the only vaguely scientific thing behind it proving it doesn’t work decades ago.
Imagine being in a catholic family, reading the Bible, and always walking away thinking that Judas did the right thing (despite everything else the Bible says). That’s US economic policy for the last 50 years.
My favorite paper published last year includes the following, now scientifically proven statements:
The preponderance of the evidence shows that rising income inequality slows economic growth [3], [4], [5], [6]. Recent analyses have shown that once one controls for wealth inequality the negative effect of income inequality on economic growth falls away as statistically insignificant, and that it has in fact been wealth inequality that has been detrimental to growth either in an inverse linear form or in the form of an inverse u-shape À la Kuznets [7], [8], [9], [10].
So economically speaking, Econ math just proved
that we need to eat the rich in order to improve anything.
From the same paper above:
From a policy perspective, the ongoing increase in the concentration of wealth is one of the main socio-economic failures of our time [1]. Not only is it likely to depress economic growth in some countries, as we measure here, it has fueled social unrest, political polarization, and populist nationalism… redistributing wealth from the rich to the poor may well be growth-enhancing in most countries
As an econ major with a BS, please don’t lump me in with the econ majors who went to business school for a MBA. I like cool math, not venture capitalism cancer.
Prove your purity
The only thing funny about the Laffer curve is how little it now matters.
It was used to justify Reagnomics, which then immediately proved we weren’t nearly as high on the Laffer curve as we assumed. Because of this, we have concrete evidence that lowering taxes on the rich doesn’t increase government revenues.
Yet we’re still doing that 50 years later. Despite the only vaguely scientific thing behind it proving it doesn’t work decades ago.
Imagine being in a catholic family, reading the Bible, and always walking away thinking that Judas did the right thing (despite everything else the Bible says). That’s US economic policy for the last 50 years.
Again!
My favorite paper published last year includes the following, now scientifically proven statements:
https://www.sciencedirect.com/science/article/pii/S003801212400003X
So economically speaking, Econ math just proved that we need to eat the rich in order to improve anything.
From the same paper above:
Wdy think of Gary’s Economics?
When your econ program is in a business college, they push the MBA hardcore. So glad I never entertained that.