Another Ride on the Laffer Curve

In a late February entry on the BusinessTrends Blog, I noted two videos narrated by economist Dan Mitchell for the Center for Freedom and Prosperity explaining the Laffer Curve. Those are:

“The Laffer Curve, Part I: Understanding the Theory” – looking at the theoretical relationship between tax rates, taxable income, and tax revenue.

“The Laffer Curve, Part II: Reviewing the Evidence” – looking at real-world Laffer Curve examples.

And now the third installment is available. It is titled “The Laffer Curve, Part III: Dynamic Scoring.”

Again, it is well worth watching. It sets the record straight on the unrealistic, static assumptions that the government uses in projecting revenue changes when taxes are increased or decreased, and shows why dynamic scoring makes sense.