Composition of taxes and growth: Evidence from OECD panel data

Arbeitspapier

This paper analyzes the impact of the composition of taxes on economic growth using a panel of OECD countries. In contrast to Kneller et al. (Fiscal policy and growth: evidence from OECD countries, 1999), over 1980-2005 distortionary taxation did not reduce growth, while an increase in non-distortionary taxation had a negative association with growth. When the data are extended to the great recession and its recovery period (1980−2015), distortionary taxation significantly reduces growth as originally conjectured, but the negative effect of non-distortionary taxation survives. This paper argues that distortions from expenditure taxes in recent years can be accounted for by a combination of an exploding increased debt/GDP and globalization.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Economics Discussion Papers ; No. 2019-43

Classification and Topics

• Classification: Wirtschaft ; Taxation, Subsidies, and Revenue: General ; Fiscal Policy ; Economic Growth and Aggregate Productivity: General
• Subject: distortionary taxation ; non-distortionary taxation ; growth

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Luo, Weijie
• Event: Veröffentlichung
• (who): Kiel Institute for the World Economy (IfW)
• (where): Kiel
• (when): 2019

Further information

• Handle: http://hdl.handle.net/10419/200395
• Last update: 10.03.2025, 11:44 AM CET