Graph/Table of the Week: Tax in Scandinavian countries

Back after the break. Below the high levels of taxation in Scandinavian countries when compared to other advanced economies.


Note that the top marginal rate goes from around 60 to close to 74%. And there is no significant price to pay in terms of on average higher unemployment or less growth. Peter Lindert referred to this as the free lunch paradox in his book Growing Public. Figure above comes from Henrik Jacobsen Kleven’s paper (subscription required).