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Taxation and Laffer Effects on Employment and Growth

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Abstract

Some dangerous short- and long-term ambiguities of fiscal policies arise from the belief that Laffer effects may be generated from deficit-financed tax cuts able to stimulate aggregate demand. However, even in a supply-side framework, fiscal illusion prevents a rational perception of the effectiveness of Laffer-oriented fiscal measures. The ambiguity of the Laffer effect led to an important series of studies of Francesco Forte, designed to disclose and empirically test its interactions with short- and long-term fiscal policies on gross domestic product (GDP) growth and on other relevant macroeconomic variables. We discuss, under the Laffer perspective, some of Francesco Forte’s studies related to fiscal policy effects on the labour market and GDP growth.

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Acknowledgments

I wish to aknowldge Gordon Brady who organised the Lisbon session in honour of Francesco Forte and Katherine Virgo for the wonderful, as usual, organization of the whole conference. A particular thank you goes to Francesco Forte, who transformed me into an economist. I will always be indebted to him.

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  1. Department of Economics and Law, Sapienza – University of Rome, Via del Castro Laurenziano 9, 00161, Rome, Italy

    Silvia Fedeli

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  1. Silvia Fedeli
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Correspondence to Silvia Fedeli.

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Fedeli, S. Taxation and Laffer Effects on Employment and Growth. Int Adv Econ Res 23, 1–7 (2017). https://doi.org/10.1007/s11294-016-9618-4

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  • DOI: https://doi.org/10.1007/s11294-016-9618-4

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