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Laffer curve |
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But it makes sense if you consider the Laffer Curve effect. Hong Kong is an almost perfect example of the Laffer Curve in action--low tax rates generate high rates of real economic growth, leading to increased revenues which can be used for social welfare while maintaining low tax rates. Irving Kristol's protege Jude Wanniski, the godfather of supply-side economics, used an AEI fellowship to write his 1978 book The Way the World Works, which promoted the dubious Laffer Curve, and its purported proof that tax cuts lead to more net government revenue. |
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