re: #207 schnapp

Ok so I got it wrong about the CBO but it is still a valid paper.

In what way? It’s a non-peer reviewed paper written to invite commentary.

And I ask again, did you read the Greg Mankiw link?

I read it. It’s talking about statutory rates, not effective rates.

And do you understand the concept of marginal analysis?

I’m sorry, but someone asserting that the difference between income and profits isn’t important really shouldn’t ask other people if they understand things. Do you understand yet why the difference between income and profit is hugely, hugely important?

so obviously if the value that they add to the firm is taxed they are going to have a lower marginal product.

Yes. But since the tax is on profits, not on the value added by the worker, what I’ve already said completely holds true. I”m sorry, but there really aren’t any more ways to explain to you why, economically, a profitable worker is not affected by a tax on profits. It makes them produce less profit for the company; however, since they’re still producing profit, they are a net benefit to the company.

If you can’t grasp that, this is not going to make any sense to you, but it’s a very, very, very easy concept to grasp.

How about you actually cite a paper by an economist saying that higher corporate taxes have absoluely no effect on wages or firms’ decision to hire.

I’m not sure why you’d ask me to cite a paper proving something I haven’t contended, except that at this point you really can’t do much except lash out at strawmen.

It is easy to show that profits don’t affect hiring, though; the current economy shows that.