3 ms·

Apparently, the Laffer curve is yet to become common knowledge.

ceejayoz 1y ago
The Laffer curve has yet to become knowledge, period. It's theoretical (if that; hypothetical might be fairer), overly simplistic, and everyone can basically assert at-will where we are on it at any time. https://en.wikipedia.org/wiki/Laffer_curve https://en.wikipedia.org/wiki/Laffer_curve Practical tests have… not gone well. https://en.wikipedia.org/wiki/Kansas_experiment https://en.wikipedia.org/wiki/Kansas_experiment
- lo_zamoyski 1y ago
  The Laffer curve doesn't tell you what the revenue-maximizing rate is or how to structure taxes. That point is that capital tends to move away from places with high taxes toward those with lower taxes passed a certain threshold. This seems obviously true. > Practical tests have… not gone well. You mean like this Norwegian "test"?
  - ceejayoz 1y ago
    > That point is that capital tends to move away from places with high taxes toward those with lower taxes passed a certain threshold. What's in dispute is where that threshold is, and how steep the curve before/after it. (It looks more like this, in other words: https://taxpolicy.org.uk/wp-content/uploads/2025/03/image-18.png https://taxpolicy.org.uk/wp-content/uploads/2025/03/image-18...) Per Wiki: "A 2011 study by Trabandt and Uhlig published in the Journal of Monetary Economics estimated a 70% revenue maximizing rate, and estimated that the US and most European economies were on the left of the Laffer curve (in other words, that raising taxes would raise further revenue). A 2005 study concluded that with the exception of Sweden, no major OECD country could increase revenue by reducing the marginal tax rate." > You mean like this Norwegian "test"? Others have pointed out that the (uncited!) numbers in this advertisement targeted at the mega-wealthy seem to be plain old made up (https://news.ycombinator.com/item?id=45930222 https://news.ycombinator.com/item?id=45930222), so yes.
    - lo_zamoyski 1y ago
      > What's in dispute is where that threshold is, and how steep the curve before/after it. Yes, but I'm not disputing that, nor is that the substance of your attack on my comment. You attacked the Laffer curve, not the presupposition that the article is factually correct, which does not discredit or undermine the Laffer curve. At best, it only removes its relevance.
      - ceejayoz 1y ago
        Again, the Laffer curve is still considered hypothetical. No discrediting needed; it has yet to be proved. Those who assert the right value is super close to zero have also been repeatedly shown to be incorrect, but they keep trying. The US could probably double top marginal taxes and not reduce revenue.

The Laffer curve has yet to become knowledge, period. It's theoretical (if that; hypothetical might be fairer), overly simplistic, and everyone can basically assert at-will where we are on it at any time. https://en.wikipedia.org/wiki/Laffer_curve https://en.wikipedia.org/wiki/Laffer_curve Practical tests have… not gone well. https://en.wikipedia.org/wiki/Kansas_experiment https://en.wikipedia.org/wiki/Kansas_experiment

lo_zamoyski 1y ago
The Laffer curve doesn't tell you what the revenue-maximizing rate is or how to structure taxes. That point is that capital tends to move away from places with high taxes toward those with lower taxes passed a certain threshold. This seems obviously true. > Practical tests have… not gone well. You mean like this Norwegian "test"?
- ceejayoz 1y ago
  > That point is that capital tends to move away from places with high taxes toward those with lower taxes passed a certain threshold. What's in dispute is where that threshold is, and how steep the curve before/after it. (It looks more like this, in other words: https://taxpolicy.org.uk/wp-content/uploads/2025/03/image-18.png https://taxpolicy.org.uk/wp-content/uploads/2025/03/image-18...) Per Wiki: "A 2011 study by Trabandt and Uhlig published in the Journal of Monetary Economics estimated a 70% revenue maximizing rate, and estimated that the US and most European economies were on the left of the Laffer curve (in other words, that raising taxes would raise further revenue). A 2005 study concluded that with the exception of Sweden, no major OECD country could increase revenue by reducing the marginal tax rate." > You mean like this Norwegian "test"? Others have pointed out that the (uncited!) numbers in this advertisement targeted at the mega-wealthy seem to be plain old made up (https://news.ycombinator.com/item?id=45930222 https://news.ycombinator.com/item?id=45930222), so yes.
  - lo_zamoyski 1y ago
    > What's in dispute is where that threshold is, and how steep the curve before/after it. Yes, but I'm not disputing that, nor is that the substance of your attack on my comment. You attacked the Laffer curve, not the presupposition that the article is factually correct, which does not discredit or undermine the Laffer curve. At best, it only removes its relevance.
    - ceejayoz 1y ago
      Again, the Laffer curve is still considered hypothetical. No discrediting needed; it has yet to be proved. Those who assert the right value is super close to zero have also been repeatedly shown to be incorrect, but they keep trying. The US could probably double top marginal taxes and not reduce revenue.