European Parliament Library

U.S. Revenue Surprises :, Are Happy Days Here to Stay?, Koshy Mathai, Andrew Swiston, Martin Mühleisen

A key question for U.S. policymakers is whether the recent strength in federal revenue is likely to continue. This question is addressed through an econometric analysis of the determinants of tax revenue, using time series that are adjusted for tax policy changes. The results suggest that growth in corporate profits and capital gains each contributed forty percent of the increase in the revenue-to-GDP ratio from 2004-2006, and rising income inequality explains much of the rest. While part of the revenue rise is the result of structural changes taking place in the U.S. economy, some of the recent buoyancy is likely to prove temporary, reflecting the highly cyclical nature of these variables
Table Of Contents
Contents; I. Introduction; II. Tax Revenue Changes: Base Growth versus Policy Changes; A. A Stylized Tax Revenue Model; B. Time Series Analysis; Figures; 1. Actual and Adjusted Tax Revenue; III. Constructing Adjusted Revenue Series; A. A Practical Approach; B. Revenue Adjustments; C. Stylized Facts; 2. Constant Tax System Revenue; IV. Long-run Equations and Short-run Dynamics; 3. Tax Base Growth and Tax Revenue Elasticity; Tables; 1. Correlations Between Revenue Elasticity and the Tax Base; A. The Estimation Approach; B. Results for Overall Tax Revenue
Literary Form
non fiction
Description based upon print version of record
Physical Description
1 online resource (31 p.)
Specific Material Designation
Form Of Item

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