--- title: Tax cuts for the wealthy only benefit the rich (2023) description: LSE researchers David Hope and Julian Limberg analysed five decades of major tax cuts for the wealthy across 18 advanced economies and found no meaningful... canonical: https://daily.dev/posts/tax-cuts-for-the-wealthy-only-benefit-the-rich-2023--r6uzlrpfo twitter:card: summary_large_image twitter:site: @dailydotdev og:type: website og:site_name: daily.dev og:title: Tax cuts for the wealthy only benefit the rich (2023) | daily.dev og:description: LSE researchers David Hope and Julian Limberg analysed five decades of major tax cuts for the wealthy across 18 advanced economies and found no meaningful... og:url: https://daily.dev/posts/tax-cuts-for-the-wealthy-only-benefit-the-rich-2023--r6uzlrpfo og:image: https://api.daily.dev/og/posts/r6UZlRpFo.png og:image:alt: Tax cuts for the wealthy only benefit the rich (2023) og:image:width: 1200 og:image:height: 630 og:locale: en --- > ## Documentation Index > Fetch the complete documentation index at: https://daily.dev/llms.txt > Use this file to discover all available pages before exploring further. # Tax cuts for the wealthy only benefit the rich (2023) **[Hacker News](https://daily.dev/sources/hn)** · 6 min read · 0 upvotes · 0 comments ## Summary LSE researchers David Hope and Julian Limberg analysed five decades of major tax cuts for the wealthy across 18 advanced economies and found no meaningful effect on unemployment or economic growth. The rich simply got richer. The paper, originally published in 2020, became the most downloaded in LSE Research Online history with around 150,000 downloads. The researchers argue that tax cuts for the rich lead to more aggressive rent-seeking by top executives at the expense of lower-income workers, aligning with Thomas Piketty's analysis. A follow-up study found that when ordinary Americans are informed how dramatically taxes on the rich have fallen over 40 years, they become less likely to support further cuts — an effect especially pronounced among Republican voters. ## Full article daily.dev links to this article rather than hosting it. Read it at the original source: ## Questions this post answers ### What did the LSE study on tax cuts for the rich find about economic growth and unemployment? Across 18 advanced economies over 50 years, major tax cuts for the rich had no meaningful effect on unemployment or economic growth. The only consistent outcome was that the wealthy got richer. The mechanism identified is rent-seeking: lower taxes prompt top executives to bargain more aggressively for their own compensation at the direct expense of lower-income workers, rather than investing in broader economic activity. _Economists and policy watchers tracking fiscal research like this follow the debate on daily.dev._ ## Community take How the wider developer community reacted, aggregated from 2 discussions and 253 comments across hackernews (as of 2026-08-07). **TL;DR:** Commenters broadly agree that tax cuts for the wealthy don't benefit the broader economy, but a significant portion of the thread is consumed by a heated semantic debate over whether 'trickle-down economics' is a strawman for 'supply-side economics' — with most concluding the distinction is largely rhetorical cover for the same policies. **Sentiment:** 5% positive · 20% mixed · 75% skeptical **The case for** - One commenter noted that VC-backed wealth transfer to tech workers could be seen as a real-world example of capital flowing down to workers, even if not scalable. - Some supply-side arguments around taxing individuals rather than corporations (as seen in Scandinavian countries) were raised as potentially defensible policy nuance. **The pushback** - Every major round of tax cuts has resulted in lower tax receipts offset by deficit spending, not the growth promised by Laffer Curve arguments. - The Laffer Curve is widely used as rhetorical cover to assume we're always on the 'over-taxed' side, rather than as an honest policy tool. - Rent-seeking and wealth concentration at the top accelerate under tax-cut regimes, consistent with r>g dynamics. - Informing voters of how much taxes on the rich have fallen tends to reduce support for further cuts, suggesting the policy relies on public ignorance. - Kansas's failed experiment with aggressive tax cuts for the wealthy is cited as a recent, clear-cut failure. - Corporate tax avoidance means that even well-intentioned supply-side reforms often don't work as advertised. **By community** - hackernews (skeptical): Overwhelmingly skeptical of tax cuts for the wealthy, with most debate focused on whether 'trickle-down' vs 'supply-side' is a meaningful distinction or just semantic deflection from the same failed policies. **Hottest debate:** Whether 'trickle-down economics' is a strawman misrepresentation of 'supply-side economics' or simply a pejorative but accurate label for the same set of policies. **Open questions** - If supply-side economics is genuinely distinct from trickle-down, what specific policies would it prescribe that haven't already been tried and failed? - Is there an empirical threshold at which Laffer Curve effects actually kick in, and has any major economy ever demonstrably been above it? - How should tax policy account for the difference between labor-intensive and capital-intensive businesses if job creation is a goal? **Highlights** > Your experience matches mine- I only ever heard "trickle down economics" used by people on the left making mocking, derisive commentary about Reagan and neocon politics. Then someone pointed out to me that my entire affluent, privileged, comfortable life is due to trickle down economics. In the last 15 years, I've had high salaries paid by various money-losing startups, financed by rich people investing in VC funds. Now I'm a millionaire, entirely as a transfer of wealth from the rich. I haven't had a job where my salary was realistically paid by customer money/business revenue since before 2010 or where any of the VCs ever made their investment back. I don't know if there's any lesson to learn from that or if it's just funny or ironic, but it is kinda entertaining to me to realize the entire Venture Capital backed economy can be seen as trickle-down economics "working". > — [meinmissoula on hackernews · 3 comments](https://news.ycombinator.com/item?id=38518228) > I'll pick up the conversation if GP won't (GP = grand parent, your post is the parent of mine and the post above is the grandparent of mine). You're missing the forest for the trees. I argue that the forest is a high level strategy that has been playing out for approaching 50 years: 1. Push money into the capital economy and cut taxes. If anyone complains, cite growth. 2. Push taxes into the labor economy and cut benefits. If anyone complains, cite fiscal responsibility. This doesn't necessarily show up to an egregious degree in any individual policy. I can think of a few examples but that's beside the point. If (1) and (2) are aggressively promoted and happen frequently while the invisible (3) and (4) -- capital pays taxes, labor gets benefits -- aren't and don't, then the net effect is intentionally and predictably and observably upwards re-distributive. The proposal filter is the actual policy. Furthermore, I don't buy the excuse that policy wonks don't understand this. Back in comparative government class, they taught us that Iran was a theocracy not because it didn't do the rituals of electing leaders, but because a Council of Religious Experts got to select the candidates. Between campaign finance and private ownership of media, it's no real surprise that we have the filtering mechanism described in the last paragraph. So why doesn't the same logic make the US a plutocracy? > — [smallmancontrov on hackernews](https://news.ycombinator.com/item?id=49214870) > You are right. I should be more forthright; I was answering elsewhere. Here's another comment I made that's relevant and. """ I think supply-side economics deserves more nuance than simply thinking we need to make the tax rate arbitrarily low. The Laffer curve isn't the only thing you should look at, since where you tax can be just as important as how much you tax. Take corporate taxes for example. If one were to advocate to get rid of corporate taxes, you might think that person unabashedly biased. What kind of person would want to give breaks to the richest people (corporations) when everyday people are the most in need of those kind of cuts, right? But the reality is that when you tax corporations, that is one of the most economically damaging taxes you can do. How about then, rather than taxing corporations, you tax the benefactors of those corporations directly? When you tax Walmart, sure you tax the C-suite, but you also make it so that Walmart can hire less people, and invest less in the economy. Rather than taxing the corporation, what if you just taxed the C-suite directly? Tax the Walton family, or the highest earning employees directly, and you get to have your cake and it too since you get similar amounts of tax revenue without damaging the economy nearly as much. You'll see this often in the social democracies of Scandinavia, like Sweden or Denmark. These are countries with strong welfare states, and yet, the corporate tax rates are often lower than the U.S., even if you look at the most red states. This is supply side economics at work, and an example of how supply-side economics can be easily misrepresented. """ > — [manlymuppet on hackernews · 2 comments](https://news.ycombinator.com/item?id=49214133) > This is ridiculous. "Trickle-down economics" is just another name for "supply-side economics". You can also call it "voodoo economics", as George H.W. Bush did. They're all referring to the exact same failed policies that have been criticized for failing to achieve what they claim to achieve for 130 years. > — [miyoji on hackernews](https://news.ycombinator.com/item?id=49214911) > every single time taxes for the wealthy were cut, it was argued that the laffler curve would make up for the loss in federal tax receipts, thus leaving us with the same level of services and a larger economy. every single time its resulted in lower tax intake compensated with more deficit spending. > — [convolvatron on hackernews · 1 comments](https://news.ycombinator.com/item?id=49213846) **Source threads** - [hackernews](https://news.ycombinator.com/item?id=49213097) · 116 points · 197 comments - [hackernews](https://news.ycombinator.com/item?id=38513258) · 56 points · 56 comments ## Similar posts on daily.dev - [Why does wealth inequality matter?](https://daily.dev/posts/why-does-wealth-inequality-matter--cgebc4dd8) · MIT News · 0 upvotes · 0 comments - [Life During Class Wartime](https://daily.dev/posts/life-during-class-wartime-5urrvhixw) · ongoing by Tim Bray · 1 upvotes · 0 comments - [If AI replaces workers, should it also pay taxes?](https://daily.dev/posts/if-ai-replaces-workers-should-it-also-pay-taxes--1pbma4fnn) · Hacker News · 0 upvotes · 0 comments --- [View this post on daily.dev](https://daily.dev/posts/tax-cuts-for-the-wealthy-only-benefit-the-rich-2023--r6uzlrpfo) ```json {"@context":"https://schema.org","@graph":[{"@type":"Organization","@id":"https://daily.dev/#organization","name":"daily.dev","url":"https://daily.dev","logo":{"@type":"ImageObject","url":"https://daily.dev/apple-touch-icon.png","width":180,"height":180},"sameAs":["https://twitter.com/dailydotdev","https://github.com/dailydotdev","https://www.linkedin.com/company/daily-dev-ltd"]},{"@type":"WebSite","@id":"https://daily.dev/#website","url":"https://daily.dev","name":"daily.dev","publisher":{"@id":"https://daily.dev/#organization"},"potentialAction":{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https://daily.dev/search?q={search_term_string}"},"query-input":"required name=search_term_string"}}]} {"@context":"https://schema.org","@type":"TechArticle","headline":"Tax cuts for the wealthy only benefit the rich (2023)","url":"https://daily.dev/posts/tax-cuts-for-the-wealthy-only-benefit-the-rich-2023--r6uzlrpfo","mainEntityOfPage":{"@type":"WebPage","@id":"https://daily.dev/posts/tax-cuts-for-the-wealthy-only-benefit-the-rich-2023--r6uzlrpfo"},"datePublished":"2026-08-07T17:30:37.229Z","dateModified":"2026-08-07T19:47:17.514Z","description":"LSE researchers David Hope and Julian Limberg analysed five decades of major tax cuts for the wealthy across 18 advanced economies and found no meaningful...","image":"https://media.daily.dev/image/upload/f_auto,q_auto/v1/posts/6b2a82241c432379f12c909533e52197?_a=AQAEuop","thumbnailUrl":"https://media.daily.dev/image/upload/f_auto,q_auto/v1/posts/6b2a82241c432379f12c909533e52197?_a=AQAEuop","isAccessibleForFree":true,"articleSection":"Hacker News","inLanguage":"en","publisher":{"@type":"Organization","name":"daily.dev","url":"https://daily.dev","logo":{"@type":"ImageObject","url":"https://daily.dev/apple-touch-icon.png","width":180,"height":180}},"author":{"@type":"Organization","name":"Hacker News","logo":"https://media.daily.dev/image/upload/t_logo,f_auto/v1/logos/hn","url":"https://daily.dev/sources/hn"},"commentCount":0,"discussionUrl":"https://daily.dev/posts/tax-cuts-for-the-wealthy-only-benefit-the-rich-2023--r6uzlrpfo","interactionStatistic":[{"@type":"InteractionCounter","interactionType":{"@type":"LikeAction"},"userInteractionCount":0},{"@type":"InteractionCounter","interactionType":{"@type":"CommentAction"},"userInteractionCount":0}],"keywords":"","timeRequired":"PT6M"} {"@context":"https://schema.org","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https://daily.dev"},{"@type":"ListItem","position":2,"name":"Hacker News","item":"https://daily.dev/sources/hn"},{"@type":"ListItem","position":3,"name":"Tax cuts for the wealthy only benefit the rich (2023)"}]} {"@context":"https://schema.org","@type":"FAQPage","@id":"https://daily.dev/posts/tax-cuts-for-the-wealthy-only-benefit-the-rich-2023--r6uzlrpfo#faq","mainEntity":[{"@type":"Question","name":"What did the LSE study on tax cuts for the rich find about economic growth and unemployment?","acceptedAnswer":{"@type":"Answer","text":"Across 18 advanced economies over 50 years, major tax cuts for the rich had no meaningful effect on unemployment or economic growth. The only consistent outcome was that the wealthy got richer. The mechanism identified is rent-seeking: lower taxes prompt top executives to bargain more aggressively for their own compensation at the direct expense of lower-income workers, rather than investing in broader economic activity. Economists and policy watchers tracking fiscal research like this follow the debate on daily.dev."}}]} ```