Enrich the Rich!(?) - Income Tax, Income Inequalities and Economic Growth
(2013) NEKH01 20122Department of Economics
- Abstract
- This paper examines the effects of an income tax cut on economic growth. The way it is examined is twofold; in part through an increased savings rate and in part through increased inequalities. The former one is considered a more direct effect of the tax cut whereas the last one is considered a more indirect effect. The income tax cut is investigated under the assumptions of the Solow growth model. The Solow growth model helps limit the different possible causational factors of economic growth. The result of this paper is that the cut in income tax fuels eco-nomic growth rates until the new equilibrium has been reached. Thus, there are no long term effects on economic growth. There are, however, long term effects on the level of output.
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/4025137
- author
- Kananen, Jonathan LU
- supervisor
- organization
- course
- NEKH01 20122
- year
- 2013
- type
- M2 - Bachelor Degree
- subject
- keywords
- Income tax rate, Solow growth model, income inequalities, economic growth
- language
- English
- id
- 4025137
- date added to LUP
- 2013-09-17 16:05:42
- date last changed
- 2013-09-17 16:05:42
@misc{4025137, abstract = {{This paper examines the effects of an income tax cut on economic growth. The way it is examined is twofold; in part through an increased savings rate and in part through increased inequalities. The former one is considered a more direct effect of the tax cut whereas the last one is considered a more indirect effect. The income tax cut is investigated under the assumptions of the Solow growth model. The Solow growth model helps limit the different possible causational factors of economic growth. The result of this paper is that the cut in income tax fuels eco-nomic growth rates until the new equilibrium has been reached. Thus, there are no long term effects on economic growth. There are, however, long term effects on the level of output.}}, author = {{Kananen, Jonathan}}, language = {{eng}}, note = {{Student Paper}}, title = {{Enrich the Rich!(?) - Income Tax, Income Inequalities and Economic Growth}}, year = {{2013}}, }