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Fiscal Policy after the Financial Crisis$
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Alberto Alesina and Francesco Giavazzi

Print publication date: 2013

Print ISBN-13: 9780226018447

Published to Chicago Scholarship Online: September 2013

DOI: 10.7208/chicago/9780226018584.001.0001

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How Do Laffer Curves Differ across Countries?

How Do Laffer Curves Differ across Countries?

(p.211) 6 How Do Laffer Curves Differ across Countries?
Fiscal Policy after the Financial Crisis

Mathias Trabandt

Harald Uhlig

University of Chicago Press

This chapter examines how Laffer curves differ across countries in the United States and the EU-14. It shows that the differences between Laffer curves arise solely due to differences in fiscal policy; that is, the mix of distortionary taxes, government spending, and government debt. Labor income and consumption taxes are important for accounting for most of the cross-country differences. A commentary is also included at the end of the chapter.

Keywords:   Laffer curves, EU-14, United States, fiscal policy, government spending, public debt, government debt, taxation, interest rates

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