“Permanent” v. “Temporary” Tax Changes

Paul Ryan is pressing hard for tax changes to be permanent rather than temporary (see a representative article here). From a traditional economic perspective he is probably right to do so if he wants policy to have maximum impact on the economy, regardless of your preferred performance metric. There exists no shortage of empirical research on this topic and I include a link here to a research note that seems typical (and more importantly is not paywalled).

» Read more