How do financing methods affect the long-run burdens of tax cuts? Q.How do financing methods affect the long-run burdens of tax cuts? A.Tax cuts are financed through reductions in current outlays or higher government debt that will eventually have to be repaid. But the distributional effect of reduced government services and the debt are excluded from standard distributional tables. Read more about How do financing methods affect the long-run burdens of tax cuts?
How should distributional tables be interpreted? Q.How should distributional tables be interpreted? A.Distributional tables provide important and useful information, but may be misinterpreted. Keep six key questions in mind to correctly interpret the results. Read more about How should distributional tables be interpreted?
What were the economic effects of the Tax Cuts and Jobs Act? Q.What were the economic effects of the Tax Cuts and Jobs Act? A.Most analysts expected the Tax Cuts and Jobs Act to boost economic output modestly in both the short and the longer run. The evidence supports the prediction for the short run. Because they are confounded by the large and lasting effects of the COVID pandemic and related policies, we will probably never be able to disentangle the long-term effects. However there was little evidence of a strong effect on investment that could lead to higher longer-run growth in the years before the pandemic. Read more about What were the economic effects of the Tax Cuts and Jobs Act?