by Byrne Hobart
It’s a surprising claim, but Mankiw has at least done the math. He argues that for any new income, he’d invest it, and let his kids inherit it. Thus:
Let’s suppose Greg Mankiw takes on an incremental job today and earns a dollar. How much, as a result, will he leave his kids in T years?
The answer depends on four tax rates. First, I pay the combined income and payroll tax on the dollar earned. Second, I pay the corporate tax rate while the money is invested in a firm. Third, I pay