THE MARGINAL INCOME-TAX RATE SCHEDULE FROM 1930 TO 1990

Although it is well known that marginal income tax rates vary with inc ome, few economists have studied the effect on real GDP of the distrib ution of marginal income tax rates, This omission is probably because data on the distribution do not exist. We remedy this shortcoming by p roviding a computer program that calculates marginal income tax rates for all income levels for the years 1930 to 1990. We conduct a prelimi nary empirical investigation into the effect of taxes on economic grow th. We find that lowering taxes significantly raises economic growth a nd that changing the tax rate schedule also has significant effects on economic growth.