Abstract
The remarkable similarities of the effects of discretionary tax changes between the US and the UK, shown in (Cloyne, J. 2013. “Discretionary Tax Changes and the Macroeconomy: New Narrative Evidence from the United Kingdom. American Economic Review 103: 1507–1528.), raise the obvious concern whether the effects of tax changes at disaggregated levels in the UK still resemble those in the US. This paper investigates the issue along three dimensions – corporate and personal income tax changes, anticipated and unanticipated tax changes, and positive and negative tax changes. An important contribution of this paper is to construct a data set on exogenous changes of corporate and personal income taxes in the UK, identified from narrative sources along the lines of Cloyne (2013).
Acknowledgement
We thank William Hawkins, Samreen Malik, Ryan Michaels and seminar participants for helpful comments. In particular, we thank James Cloyne for providing us with the data and valuable comments. We also thank Mahlaqa Irfan for her excellent research assistance. All mistakes are our own.
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Supplemental Material
The online version of this article offers supplementary material (DOI: https://doi.org/10.1515/bejm-2016-0041).
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