Rates or revenues? On the relation between tax structures and growth
(2013) NEKP01 20131Department of Economics
- Abstract
- This paper uses panel data from 45 OECD and Latin American countries over 21 years to estimate the effect of different tax structures on GDP growth. A key aim is to compare the results from using two common measurement techniques, statutory tax rates and tax revenues as share of total tax income. The results from GMM estimations indicate that the choice of measure not only affects the statistical results, but is of critical importance regarding economic interpretations. While the use of tax rates show a small significant negative connection between corporate income taxes and growth, tax revenues demonstrate a positive effect. The results call for more caution and better theoretical understanding regarding the effect of tax structures on... (More)
- This paper uses panel data from 45 OECD and Latin American countries over 21 years to estimate the effect of different tax structures on GDP growth. A key aim is to compare the results from using two common measurement techniques, statutory tax rates and tax revenues as share of total tax income. The results from GMM estimations indicate that the choice of measure not only affects the statistical results, but is of critical importance regarding economic interpretations. While the use of tax rates show a small significant negative connection between corporate income taxes and growth, tax revenues demonstrate a positive effect. The results call for more caution and better theoretical understanding regarding the effect of tax structures on growth given the choice of measure. (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/3865553
- author
- Andersson, Henrik LU
- supervisor
-
- Åsa Hansson LU
- organization
- course
- NEKP01 20131
- year
- 2013
- type
- H2 - Master's Degree (Two Years)
- subject
- keywords
- Growth, Tax revenues, Tax structures, Tax rates, Panel data
- language
- English
- id
- 3865553
- date added to LUP
- 2013-07-01 10:39:48
- date last changed
- 2013-07-01 10:39:48
@misc{3865553, abstract = {{This paper uses panel data from 45 OECD and Latin American countries over 21 years to estimate the effect of different tax structures on GDP growth. A key aim is to compare the results from using two common measurement techniques, statutory tax rates and tax revenues as share of total tax income. The results from GMM estimations indicate that the choice of measure not only affects the statistical results, but is of critical importance regarding economic interpretations. While the use of tax rates show a small significant negative connection between corporate income taxes and growth, tax revenues demonstrate a positive effect. The results call for more caution and better theoretical understanding regarding the effect of tax structures on growth given the choice of measure.}}, author = {{Andersson, Henrik}}, language = {{eng}}, note = {{Student Paper}}, title = {{Rates or revenues? On the relation between tax structures and growth}}, year = {{2013}}, }