Scandinavian Working Papers in Economics
Working Papers,
Lund University, Department of Economics
No 2002:20: The Wealth Tax and Economic Growth
Åsa Hansson ()
Additional contact information
Åsa Hansson: Department of Economics, Lund University, Postal: Department of Economics, School of Economics and Management, Lund University, Box 7082, S-220 07 Lund, Sweden
Abstract: Heated discussions of the economic effects of the wealth tax have raged in the popular media in a number of European countries. The academic community has been considerably quieter, however. This paper attempts to fill this gap by empirically estimating the relationship between the wealth tax and economic growth in 20 OECD countries over the time period 1980 to 1999. Using an instrumental variables approach and "differenced" data to control for two types of endogeneity, I find fairly robust support for the popular contention that wealth taxes dampen economic growth. The estimated magnitude, however, is somewhat less alarming than popular account.
Keywords: Wealth tax; economic growth; OECD countries
22 pages, October 30, 2002
- Published as
- Åsa Hansson, (2010), 'Is the Wealth Tax Harmful to Economic Growth?', World Tax Journal, vol 2, no 1, pages 19-34
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