Tax Changes, Revenue Impacts, Conditional Statements, and Other Things that Befuddle the Statistically Disinclined

{ Posted on Jun 30 2011 by Menzie Chinn }

Or, a weblog post for the benefit of those unable to read beyond a technical paper’s abstract, a clarification of what exactly Romer and Romer (2010) found regarding the impact of tax increases on tax revenues. This note is inspired by Econbrowser reader Ricardo (who also goes under the monikers of RicardoZ, Dick, and DickF) who inaccurately (but with inexplicable confidence) characterizes the Romer and Romer findings regarding tax changes in my last post’s comments:

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