Laffer Curve Revisited

You may recall The Wall Street Journal’s July 13 editorial which proved that the Laffer Curve is real if you restrict your attention to corporate tax rates, mis-code Norway, and draw your line wrong. Thanks to Kevin Hassett’s efforts to spell this argument out in more detail, Brendan Nyhan was able to look at the exact same data and draw the line correctly:

If you exclude Norway, who’s oil tax revenue shouldn’t really be lumped in with corporate income taxes in general (it’s more like a royalty), things look even less like the WSJ version of reality.