Replication data for: The Macroeconomic Effects of Tax Changes: Estimates Based on a New Measure of Fiscal Shocks

Principal Investigator(s): View help for Principal Investigator(s) Christina D. Romer; David H. Romer

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Project Citation:

Romer, Christina D., and Romer, David H. Replication data for: The Macroeconomic Effects of Tax Changes: Estimates Based on a New Measure of Fiscal Shocks. Nashville, TN: American Economic Association [publisher], 2010. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-11. https://doi.org/10.3886/E112357V1

Project Description

Summary: This paper investigates the impact of tax changes on economic activity. We use the narrative record, such as presidential speeches and Congressional reports, to identify the size, timing, and principal motivation for all major postwar tax policy actions. This analysis allows us to separate legislated changes into those taken for reasons related to prospective economic conditions and those taken for more exogenous reasons. The behavior of output following these more exogenous changes indicates that tax increases are highly contractionary. The effects are strongly significant, highly robust, and much larger than those obtained using broader measures of tax changes. (JEL E32, E62, H20, N12)

Scope of Project

JEL Classification:
      E32 Business Fluctuations; Cycles
      E62 Fiscal Policy
      H20 Taxation, Subsidies, and Revenue: General
      N12 Economic History: Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations: U.S.; Canada: 1913-

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V1 [2019-10-11]

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