The revenue smoothing hypothesis in an ARIMA Framework: Evidence from the United States, in Claude Diebolt, Catherine Kyrtsou et al. (eds.), New Trends in Macroeconomics

This paper tests Mankiw’s (1987) revenue-smoothing hypothesis, that the inflation rate moves one-for-one with the marginal tax rate in the long run, using the new average marginal tax rate series constructed by Stephenson (1998) and the long-horizon regression approach developed by Fisher and Se