Ever wonder how Scandinavian countries pay for their government spending? https://t.co/GSqNeB70oC @kpomerleau pic.twitter.com/SIgU8drlQc
— Tax Foundation (@TaxFoundation) November 13, 2015
How Scandinavian Countries Pay for Their Government Spending
20 Nov 2015 1 Comment
in politics - Australia, politics - New Zealand, politics - USA, Public Choice, public economics Tags: Denmark, Finland, growth of government, Norway, Scandinavia, size of government, Sweden, taxation and entrepreneurship, taxation and investment, taxation and labour supply, welfare state
Do the European welfare states free ride off American entrepreneurship and innovation?
12 Nov 2015 1 Comment
in applied price theory, applied welfare economics, comparative institutional analysis, constitutional political economy, economic history, economics of regulation, entrepreneurship, industrial organisation, politics - USA, public economics, survivor principle, taxation, technological progress Tags: creative destruction, Daron Acemoglu, Denmark, entrepreneurial alertness, Eurosclerosis, international technology diffusion, taxation and entrepreneurship, taxation and innovation, taxation and investment, taxation and labour supply, technology followers, welfare state
Source: Daron Acemoglu A Scandinavian U.S. Would Be a Problem for the Global Economy – NYTimes.com.
Will high marginal tax rates and redistribution fix inequality?
18 Oct 2015 Leave a comment
in applied price theory, applied welfare economics, entrepreneurship, human capital, labour economics, occupational choice, politics - USA, poverty and inequality Tags: Gini coefficient, rational irrationality, taxation and entrepreneurship, taxation and human capital, taxation and labour supply, taxation investment
The benefits and costs of the @NZSuperFund since its inception
17 Aug 2015 Leave a comment
in applied price theory, applied welfare economics, economic growth, economic history, entrepreneurship, financial economics, fiscal policy, industrial organisation, labour economics, labour supply, macroeconomics, politics - New Zealand, public economics Tags: ageing society, company tax rate, deadweight cost of taxes, demographic crisis, efficient markets hypothesis, laffer curve, New Zealand superannuation fund, old age pensions, retirement savings, social insurance, sovereign wealth funds, taxation and entrepreneurship, taxation and investment, taxation and labour supply
Most mutual funds still can't beat their benchmark read.bi/1GkTig1 http://t.co/r7ezoDGJbV—
BI Chart of the Day (@chartoftheday) June 03, 2015
The New Zealand Superannuation Fund, the sovereign wealth fund part funding New Zealand’s old-age pension from 2029/2030 onwards, has been a bit of a wild ride. Sometimes the earnings of the Fund were well below and sometimes earning well above the long-term bond rate.
![image_thumb[3]](https://utopiayouarestandinginit.com/wp-content/uploads/2015/08/image_thumb310.png "image_thumb[3]")
Source: New Zealand Superannuation Fund Annual Report 2014.
Since its inception, the Fund earned an average annual return of 9.78%, which was 5.06% above the long-term bond rate, and 1.03% above its reference portfolio.
No information was given in the annual report of the New Zealand Superannuation Fund on the marginal dead weight cost of the taxes raised to fund the New Zealand Superannuation Fund to see whether there is any net benefit to taxpayers from its establishment and continued operation.
The New Zealand Government has contributed $14.88 billion to the fund from prior its inception in 2001 to the suspension of contributions in 2009 by the incoming National Party Government.
Source: New Zealand Treasury.
Over the nine years in which contributions were made, the company tax rate of 28% could have easily been up to 10 percentage points lower.
The New Zealand Treasury estimates that a one percentage point cut in the company tax costs about $220 million in forgone revenue if there are no other changes to the tax system. These are static estimates that do not include any feedback from greater investment and higher growth.
The New Zealand Superannuation Fund must beat the market every single year to make up for the deadweight cost of its funding, a premium for the investment risk added to the Crown’s portfolio and the cost to New Zealand’s growth rate of higher than otherwise taxes on income, entrepreneurship and investment.
Source: Abolish the Corporate Income Tax – The New York Times.
How @equitablegrowth showed inequality helps growth when arguing inequality harms growth
10 Aug 2015 1 Comment
in applied price theory, applied welfare economics, comparative institutional analysis, currency unions, economic growth, economic history, economics of regulation, entrepreneurship, Euro crisis, fiscal policy, global financial crisis (GFC), income redistribution, labour economics, labour supply, macroeconomics, Marxist economics, poverty and inequality, Public Choice, public economics, rentseeking Tags: British disease, entrepreneurial alertness, Eurosclerosis, France, German unification, Germany, growth of government, sick man of Europe, social insurance, Sweden, taxation and entrepreneurship, taxation and investment, taxation and labour supply, welfare state
The Washington Centre for Equitable Growth recently tweeted that inequality harms growth in the USA as compared to Sweden, France, Germany and the UK. It was relying on some dodgy OECD research.
.@OECD sees continued rise in growth-harming inequality, reports @PaulHannon29 on.wsj.com/1EZpq1S http://t.co/xt4heZysXT—
Equitable Growth (@equitablegrowth) May 21, 2015
The Washington Centre for Equitable Growth did not check their inequality ratios they tweeted against trends in economic growth and economic policy since 1970, which I have reproduced in figure 1. Germany is not included in figure 1 because German data on growth is thrown askew by German unification.
Figure 1: Real GDP per British, French and Swede aged 15-64, 2014 US$ (converted to 2014 price level with updated 2011 PPPs), 1.9 per cent detrended, 1970-2013
Source: Computed from OECD Stat Extract and The Conference Board. 2015. The Conference Board Total Economy Database™, May 2015, http://www.conference-board.org/data/economydatabase/
Figure 1 shows that France has been in a long-term decline since the late 1970s despite the blessings of a more equal society than the USA as championed by the Washington Centre for Equitable Growth. In figure 1, a flat line is growth in real GDP per working age person, PPP, at the same rate as the USA for the 20th century, which was 1.9% per year. A falling line in figure 1 indicates growth of less than 1.9% while a rising line indicates growth in real GDP per working age person, PPP, in excess of 1.9%. In figure 1, France hardly ever grew at the trend rate of growth for the USA of 1.9% per year and was frequently well below that rate.
Sweden tells a slightly different story in figure 1 because of regime change in the early 1990s when Sweden adopted more liberal economic policies where taxes and government spending were reduced:
The rapid growth of the state in the late 1960s and 1970s led to a large decline in Sweden’s relative economic performance. In 1975, Sweden was the 4th richest industrialised country in terms of GDP per head. By 1993, it had fallen to 14th.
@alexvoronov använda smygfinansiering av Generell Välfärd är alltid av ondo. @NimaSanandaji: bit.ly/1Nar2eV http://t.co/wD0YEgncIE—
Old Whig (@aClassicLiberal) August 05, 2015
That regime change reversed a long economic decline since 1970 under the egalitarian policies of the Swedish Social Democratic Party. Under the Swedish Social Democratic Party, Sweden was almost always growing at less than the trend rate of growth of the USA, which was 1.9%. That position reversed only when there was a turn away from big government and high taxes.
Figure 1 tells a similar story for the British economy: a long economic decline in the 1970s when Britain was the sick man of Europe. Under Thatchernomics, Europe had a long economic boom for 20 years or more – see figure 1.
In the 1970s, under the high taxes of the Heath, Callaghan and Wilson administrations, as figure 1 shows, Britain was the sick man of Europe. With the election of the Thatcher Government, Britain soon grew at better than the US trend growth rate for nearly 20 years through few exceptions.
Graph of the Day: The UK has among the lowest total tax rates on businesses in the G7 http://t.co/l6mMhN9yLD—
CPS Think Tank (@CPSThinkTank) August 04, 2015
Swedosclerosis and Eurosclerosis compared
10 Aug 2015 Leave a comment
in applied welfare economics, comparative institutional analysis, economic growth, economic history, economics of regulation, industrial organisation, labour economics, labour supply, macroeconomics, survivor principle Tags: Eurosclerosis, Sweden, taxation and entrepreneurship, taxation and investment, taxation and labour supply, welfare state
The taxes paid by the rich, middle-class and the poorer in the USA
09 Aug 2015 Leave a comment
in politics - USA, public economics Tags: creative destruction, entrepreneurial alertness, envy, taxation and entrepreneurship, taxation and investment, taxation and the labour supply, top 1%
Average Income Before & After Federal Taxes from "An Illustrated Guide to Income" bit.ly/1j9ymXF #inequality http://t.co/eabwDATSlU—
Catherine Mulbrandon (@VisualEcon) April 28, 2014
The tax rates of the top 1%
04 Aug 2015 Leave a comment
in applied welfare economics, entrepreneurship, fisheries economics, income redistribution, politics - USA, rentseeking Tags: entrepreneurial alertness, envy, taxation and entrepreneurship, taxation and investment, taxation and the labour supply, top 1%
Historical Tax Rates of Top 0.01% (15,000 returns reporting more than $8 million in 2010) visualizingeconomics.com/blog/2013/8/14… http://t.co/XygW0t0npu—
Catherine Mulbrandon (@VisualEcon) August 15, 2013
Trigger warning for the Twitter Left
31 Jul 2015 Leave a comment
in applied price theory, applied welfare economics, constitutional political economy, income redistribution, politics - Australia, politics - New Zealand, politics - USA, Public Choice, public economics, rentseeking Tags: antimarket bias, endogenous growth theory, expressive voting, laffer curve, Leftover Left, taxation and entrepreneurship, taxation and human capital, taxation and investment, taxation and the labour supply, top 1%, Twitter left
Tax revenues as a percentage of GDP, selected OECD member countries
28 Jul 2015 Leave a comment
in politics - Australia, politics - USA, public economics Tags: Eurosclerosis, growth of government, sick man of Europe, size of government, taxation and entrepreneurship, taxation and investment, taxation and the labour supply
How does America's tax revenue compare to the average collected by OECD countries? bit.ly/1HTtRTg #TaxDay http://t.co/Q17jMuwtNI—
The Hamilton Project (@hamiltonproj) April 15, 2015
Gary Becker and Kevin Murphy on inequality and growth in living standards
23 Jul 2015 Leave a comment
Top marginal income tax rate throughout the 20th century
29 Jun 2015 Leave a comment
in economic history, entrepreneurship, income redistribution, politics - USA, Public Choice, public economics, rentseeking Tags: Eurosclerosis, taxation and entrepreneurship, taxation and investment, taxation and the labour supply, top 1%
Piketty presents the changes in the top marginal income tax rate throughout the 20th century… #GCLIS http://t.co/sFpV0ypC5C—
LIS (@lisdata) April 16, 2014
Utopia, you are standing in it! 
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