Evidence on the High-Income Laffer Curve from Six Decades of Tax Reform

IN THE 1980S, federal income tax policy took center stage in the political arena. An influential group of supply-side economists argued that high marginal tax rates were severely reducing the incentives of people to work, and that cutting tax rates, by stimulating people to work harder and earn more income, could actually raise revenue. This idea is known in popular parlance as the Laffer curve, after the economist Arthur Laffer, who (according...