An experimental examination of general equilibrium tax incidence

Herman C. Quirmbach, Charles W. Swenson, Cynthia C. Vines

Research output: Contribution to journalArticlepeer-review

7 Scopus citations


Tax incidence is examined in an experimental general equilibrium production micro economy. Consistent with predictions, the imposition of a tax on corporate capital resulted in a flow of capital out of the corporate sector, decreased corporate usage of capital relative to labor, and tax-shifting through decreases in the relative prices of capital and non-corporate output. Although capital owners were able to shift some of the tax burden, the corporate tax resulted in a 35% drop in capital owners' share of payoffs. Implications for policy are discussed.

Original languageEnglish
Pages (from-to)337-358
Number of pages22
JournalJournal of Public Economics
Issue number3
StatePublished - Sep 1996


  • Experimental markets
  • General equilibrium
  • Tax incidence
  • Taxation of capital

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics


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