Tax cuts and economic activity: Israel in the 2000s

Zvi Hercowitz, Avihai Lifschitz

Research output: Contribution to journalArticlepeer-review


This paper evaluates the quantitative macroeconomic effects of the persistent decline of income and corporate tax rates in Israel during the 2000s. The analysis is based on the simulation of a calibrated model, given a parameterized version of the tax rates process in this period. The results indicate an important contribution of the tax process to the expansion of GDP during the 2000s.

Original languageEnglish
Pages (from-to)97-125
Number of pages29
JournalIsrael Economic Review
Issue number2
StatePublished - 2015
Externally publishedYes


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