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LSE study of 18 countries finds tax cuts for the wealthy increased inequality without boosting growth or jobs
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Illustration only Photo by Tobias Jelskov on Unsplash
A London School of Economics study covering 18 countries over five decades found that major tax cuts for the wealthy produced no meaningful improvement in growth or unemployment but consistently increased the top 1%'s share of income.
The study undercuts the core economic argument that has justified decades of top-rate tax cuts across Anglo-American economies. For anyone who works for a living in those economies, the loss of union bargaining power documented alongside these cuts correlates with flat real wages even as productivity rose. The findings are relevant to current debates over tax policy and labor organizing in tech and other industries.
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Hope and Limberg examined 18 countries from 1965 to 2015 and found no measurable growth or employment benefit from tax cuts targeting the wealthy, only a consistent rise in top-1% income share.
US union membership fell from roughly 20% of the workforce in 1980 to under 11% today, and UK membership fell from over 50% to about 23%, removing the primary mechanism workers had to claim productivity gains.
The economic damage was geographically concentrated in former industrial regions such as America's Rust Belt and northern England, where single-industry local economies collapsed and did not recover across generations.
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