The effect of legislated tax changes on the trade balance: Empirical evidence for the United States, Germany, and the United Kingdom

Hayo, Bernd; Mierzwa, Sascha

doi:10.1016/j.jmacro.2023.103564

Journal of Macroeconomics

2023

DOI: 10.1016/j.jmacro.2023.103564

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The effect of legislated tax changes on the trade balance: Empirical evidence for the United States, Germany, and the United Kingdom

Bernd Hayo,

Sascha Mierzwa

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2024

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Cited by 2 publications

References 35 publications

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Spillovers from tax shocks to the Euro area

Mierzwa

2024

Oxford Economic Papers

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I study the spillover effects of legislated discretionary tax changes in the USA, Germany, and the UK to a panel of eleven Eurozone countries for the period 1980Q1–2018Q4 employing Local Projections. When considering aggregated tax shocks, I find little evidence for significant spillovers. When allowing for state-dependent effects, I find no effects of German or US tax cuts regardless of the state of the business cycle. When allowing for asymmetric effects, there is, in general, evidence for negative (positive) spillovers from US, German, and UK tax hikes (UK tax cuts). US tax hikes always cause adverse spillovers, whereas the effects for Germany and the UK are state dependent. When considering country-specific effects, the effects turn out as heterogeneous across the Eurozone countries. UK tax cuts are generally expansionary, whereas US (German) tax cuts cause positive spillovers mainly during recessionary (non-recessionary) times.

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Spillovers from tax shocks to the Euro area

Mierzwa

2024

Oxford Economic Papers

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Review of periodical literature for 2023: (vi) 1945 to present

Paker

2024

The Economic History Review

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The effect of legislated tax changes on the trade balance: Empirical evidence for the United States, Germany, and the United Kingdom

Cited by 2 publications

References 35 publications

Spillovers from tax shocks to the Euro area

Spillovers from tax shocks to the Euro area

Review of periodical literature for 2023: (vi) 1945 to present

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