US

Tax Proposals

Question A:

Restoring the top individual federal income tax rate to 39.6% for incomes over $400,000 (from the current 37%) and taxing the capital gains and dividends of taxpayers with income over $1 million at that top rate (instead of the current preferential rate of 20%), with no other associated changes in taxes or spending, would be unlikely to hurt economic growth noticeably.

Responses weighted by each expert's confidence

Question B:

Restoring the top tax rate, removing the preferential rate on capital gains and dividends, and raising the corporate tax rate from 21% to 28%, with no other associated changes in taxes or spending, would be likely to lead to a meaningful sustained reduction in fiscal deficits.

Responses weighted by each expert's confidence

Question A Participant Responses

Participant University Vote Confidence Bio/Vote History
Acemoglu
Daron Acemoglu
MIT
Strongly Agree
5
Bio/Vote History
Removing the overly favorable tax treatment of capital would have other benefits, such as reducing incentives for excessive automation.
-see background information here
Altonji
Joseph Altonji
Yale
Strongly Agree
7
Bio/Vote History
Auerbach
Alan Auerbach
Berkeley
Uncertain
5
Bio/Vote History
Autor
David Autor
MIT
Strongly Agree
8
Bio/Vote History
We've seen this movie before during the Clinton and Obama administrations. It has a happy ending.
Baicker
Katherine Baicker
University of Chicago
Uncertain
3
Bio/Vote History
Banerjee
Abhijit Banerjee
MIT
Strongly Agree
7
Bio/Vote History
Bertrand
Marianne Bertrand
Chicago
Agree
8
Bio/Vote History
Brunnermeier
Markus Brunnermeier
Princeton
Agree
5
Bio/Vote History
Chetty
Raj Chetty
Harvard Did Not Answer Bio/Vote History
Chevalier
Judith Chevalier
Yale
Agree
7
Bio/Vote History
Cutler
David Cutler
Harvard
Agree
6
Bio/Vote History
Deaton
Angus Deaton
Princeton
Agree
7
Bio/Vote History
Duffie
Darrell Duffie
Stanford
Uncertain
2
Bio/Vote History
I support the policy on distributional grounds, but I'm uncertain of whether it affects total output growth noticeably.
Edlin
Aaron Edlin
Berkeley
Agree
6
Bio/Vote History
Eichengreen
Barry Eichengreen
Berkeley
Agree
3
Bio/Vote History
Agree w/ low confidence. Would agree with higher confidence were revenues spent on infrastructure & early childhood education.
Einav
Liran Einav
Stanford
Strongly Agree
1
Bio/Vote History
Fair
Ray Fair
Yale
Disagree
5
Bio/Vote History
Not sure what "noticeably" means. It's a least a slight negative.
Finkelstein
Amy Finkelstein
MIT
Agree
6
Bio/Vote History
Goldberg
Pinelopi Goldberg
Yale
Agree
5
Bio/Vote History
Goolsbee
Austan Goolsbee
Chicago
Strongly Agree
10
Bio/Vote History
How many time do we have to go over this? Seriously.
Greenstone
Michael Greenstone
University of Chicago
Strongly Agree
7
Bio/Vote History
Hall
Robert Hall
Stanford
Uncertain
7
Bio/Vote History
Tremendously complicated issue.
Hart
Oliver Hart
Harvard
Agree
6
Bio/Vote History
Holmström
Bengt Holmström
MIT
Uncertain
3
Bio/Vote History
Hoxby
Caroline Hoxby
Stanford Did Not Answer Bio/Vote History
Hoynes
Hilary Hoynes
Berkeley
No Opinion
Bio/Vote History
Judd
Kenneth Judd
Stanford
Agree
5
Bio/Vote History
These tax increases may affect growth in long run but not immediately.
Kaplan
Steven Kaplan
Chicago Booth
Disagree
6
Bio/Vote History
Tax cut of 2017 appears to have helped economy. Tax increase in a big recession would hurt it.
Kashyap
Anil Kashyap
Chicago Booth
Agree
1
Bio/Vote History
Klenow
Pete Klenow
Stanford
Agree
5
Bio/Vote History
Levin
Jonathan Levin
Stanford
Uncertain
3
Bio/Vote History
Maskin
Eric Maskin
Harvard
Agree
5
Bio/Vote History
Nordhaus
William Nordhaus
Yale
Agree
6
Bio/Vote History
Obstfeld
Maurice Obstfeld
Berkeley
Agree
5
Bio/Vote History
Saez
Emmanuel Saez
Berkeley
Agree
9
Bio/Vote History
Samuelson
Larry Samuelson
Yale
Agree
8
Bio/Vote History
Scheinkman
José Scheinkman
Columbia University
Disagree
7
Bio/Vote History
Increased taxes on dividends and CG would increase capital misallocation by firms. Also increase misallocation to owner occupied housing.
-see background information here
Schmalensee
Richard Schmalensee
MIT
Agree
4
Bio/Vote History
Shapiro
Carl Shapiro
Berkeley
Strongly Agree
7
Bio/Vote History
And using the proceeds to fund pro-growth policies like infrastructure, education, and clean energy R&D
Shimer
Robert Shimer
University of Chicago
Uncertain
5
Bio/Vote History
I agree in the short run. It's less clear in the medium run, but then perhaps that is also less "noticeable"
Stock
James Stock
Harvard
Agree
4
Bio/Vote History
Thaler
Richard Thaler
Chicago Booth
Agree
1
Bio/Vote History
Udry
Christopher Udry
Northwestern Did Not Answer Bio/Vote History

Question B Participant Responses

Participant University Vote Confidence Bio/Vote History
Acemoglu
Daron Acemoglu
MIT
Agree
4
Bio/Vote History
Altonji
Joseph Altonji
Yale
Strongly Agree
7
Bio/Vote History
Auerbach
Alan Auerbach
Berkeley
Uncertain
5
Bio/Vote History
Autor
David Autor
MIT
Strongly Agree
8
Bio/Vote History
These specific cuts ballooned the federal budget deficit; reversing them would have the opposite effect. (This is not ideal policy either)
Baicker
Katherine Baicker
University of Chicago
Uncertain
3
Bio/Vote History
Banerjee
Abhijit Banerjee
MIT
Strongly Agree
8
Bio/Vote History
Bertrand
Marianne Bertrand
Chicago
Agree
6
Bio/Vote History
Brunnermeier
Markus Brunnermeier
Princeton
Agree
5
Bio/Vote History
Despite such a measure the public debt level will still be very high for the foreseeable future.
Chetty
Raj Chetty
Harvard Did Not Answer Bio/Vote History
Chevalier
Judith Chevalier
Yale
Agree
7
Bio/Vote History
Cutler
David Cutler
Harvard
Strongly Agree
5
Bio/Vote History
Deaton
Angus Deaton
Princeton
Agree
7
Bio/Vote History
Duffie
Darrell Duffie
Stanford
Agree
2
Bio/Vote History
Before considering growth effects, it's obvious. It also seems likely after considering growth effects.
Edlin
Aaron Edlin
Berkeley
Agree
6
Bio/Vote History
Eichengreen
Barry Eichengreen
Berkeley
Uncertain
3
Bio/Vote History
My caveat to the earlier question applies here as well. I'm also uncomfortable with the underspecified qualifier "sustained."
Einav
Liran Einav
Stanford
Agree
1
Bio/Vote History
Fair
Ray Fair
Yale
Agree
5
Bio/Vote History
Finkelstein
Amy Finkelstein
MIT
Agree
6
Bio/Vote History
Goldberg
Pinelopi Goldberg
Yale
Disagree
5
Bio/Vote History
Increasing the corporate tax rate would just lead to more tax avoidance
Goolsbee
Austan Goolsbee
Chicago
Strongly Agree
10
Bio/Vote History
And once more for the folks who just won't learn: HOW MANY TIMES DO WE NEED TO REDISCOVER THAT TAXES RAISE REVENUE AND TAX CUTS DON'T?
Greenstone
Michael Greenstone
University of Chicago
Strongly Agree
7
Bio/Vote History
Hall
Robert Hall
Stanford
Uncertain
6
Bio/Vote History
Even more complicated
Hart
Oliver Hart
Harvard
Agree
6
Bio/Vote History
Holmström
Bengt Holmström
MIT
Agree
3
Bio/Vote History
Hoxby
Caroline Hoxby
Stanford Did Not Answer Bio/Vote History
Hoynes
Hilary Hoynes
Berkeley
No Opinion
Bio/Vote History
Judd
Kenneth Judd
Stanford
Agree
6
Bio/Vote History
Kaplan
Steven Kaplan
Chicago Booth
Disagree
3
Bio/Vote History
Kashyap
Anil Kashyap
Chicago Booth
Agree
5
Bio/Vote History
Of course Biden is proposing lots of additional spending, so I don't expect the budget outlook to improve. If rates rise, trouble...
Klenow
Pete Klenow
Stanford
Agree
4
Bio/Vote History
Levin
Jonathan Levin
Stanford
Uncertain
3
Bio/Vote History
Maskin
Eric Maskin
Harvard
Agree
3
Bio/Vote History
Nordhaus
William Nordhaus
Yale
Agree
6
Bio/Vote History
Obstfeld
Maurice Obstfeld
Berkeley
Uncertain
5
Bio/Vote History
Saez
Emmanuel Saez
Berkeley
Strongly Agree
9
Bio/Vote History
Samuelson
Larry Samuelson
Yale
Agree
8
Bio/Vote History
Repeated attempts have provided strong evidence that reducing tax rates does not increase tax revenue.
Scheinkman
José Scheinkman
Columbia University
Agree
8
Bio/Vote History
Suffices to repeal Trump's reform, another failed Republican attempt to show that lowering taxes decreases deficits.
Schmalensee
Richard Schmalensee
MIT
Agree
4
Bio/Vote History
Shapiro
Carl Shapiro
Berkeley
Agree
8
Bio/Vote History
Shimer
Robert Shimer
University of Chicago
Agree
5
Bio/Vote History
Stock
James Stock
Harvard
Agree
6
Bio/Vote History
Thaler
Richard Thaler
Chicago Booth
Disagree
1
Bio/Vote History
Udry
Christopher Udry
Northwestern Did Not Answer Bio/Vote History