His model simply takes taxes OUT of the employers line items of cost (in bulk) and re-inserts the same number (in bulk) as a direct consumer cost to model the growth impacts on the overall economy (he does this with several tax schemes one if which is a generic sales tax scheme.) The impact on wages is an incidental effect, not a cause.
You care to find that anywhere in his IGEM description, or in any report he has ever done on his IGEM model. I haven't and I have been looking continuously for such an inclusion or even the hint of such to determine the magnitude of the costs he might have used. He doesn't mention business tax related cost factors, only tax per-se anywhere in any of his model input descriptions.
Sorry here you are the one making assumtions just as you did about Jorgenson attempting to model the FairTax provisions.
Well, see, that's the problem ... there's too much assumin' goin' on! Assume all you want. Just don't try and make conjecture look like fact by trotting out an authoritative source unless the authoratitive source used the same assumptions.
I certainly agree there has been a lot of assumin' goin on!! On all sides. And therein lay the problem.
That is why I have been reviewing the details of his models and his works. None address or even mention business tax related overhead cost inputs anywhere in his models. In fact the only adjustment to wage is for changes in tax per-se that I can find anywhere in the IGEM model functions.
NOW were getting somewhere! Moving from "Jorgensen PROVES what we say" to "Jorgenson doesn't PRECLUDE what we say" is a MONUMENTAL move!
Glad you see the potential for business tax related overhead making room for substantive purchasing power gains for the individual and buisiness.
OK. How about your own reposting of his responses to RobFromGA?:
"A more reasonable interpretation of my 1996 testimony is that workers would keep that after-tax pay; producers' prices would fall, but retail prices would be increased by the national retail sales tax. Any gains by workers and investors would be the result of increase economic efficiency."One would think the by now, with all the in-depth searching I'm sure you've done, you'd have turned up SOMETHING ... that is, unless there isn't anything there to find. Don't you get it? He didn't model your favorite part of the debate. You'll have to find another source.
Of course, you could, like RobFromGA, simply ask Dr. Jorgenson directly.
I'm happy to admit that the FairTax has the potential to improve economic efficiency; I've never said it wouldn't. More to the point, I have explicitly, and repeatedly agreed that there are costs to be saved and passed on in some form (growth, wages, prices, etc.) In fact, my investigation of the topic several year ago allowed for a net savings of about 10% (including the highest number for "compliance costs" that I could get any of you to throw out there.) Unfortunately, all that does is gin up the ire of those who insist that not only do they get a 20% reduction in prices, but the also get a 20% increase in take home pay AND the non-tax savings to business will yield untold (literally) riches to the common man! all because Dr. Jorgenson said so!
But, as you have found, if there is any rigorous analysis of such savings they aren't in the oft-cited works of Dr. Jorgenson.
How about this: I'll stop saying that non-tax cost data is not in there if you'll stop claiming it is. After all, you're assuming it's in there somewhere DESPITE not finding any hint of it; I'm assuming it's NOT in there BECAUSE there his no hint of it.