Their analysis of 50 years' worth of tax cuts for the wealthy in 18 countries counters arguments that such cuts "trickle down" to the rest of the economy.
Large tax cuts for the rich don't lead to economic growth and employment but instead cause higher income inequality, a new study that examined tax cuts over 50 years suggested.
A recent paper by David Hope of the London School of Economics and Julian Limberg of King's College London found that tax cuts for the rich in 18 countries predominantly benefited the wealthy.
After major tax cuts for the rich were introduced, the top 1% share of pretax national income increased by almost 1 percentage point, they found.
Supporters say tax cuts for the rich can lead wealthy people to put in more hours and effort at work, boosting economic activity, the researchers said.
Other arguments for trickle-down tax cuts include that they allow wealthy people to invest more and benefit the economy.
Top incomes have risen rapidly since the 1980s — and as they grew, more tax cuts for the wealthy were introduced, the researchers said. »
