Laffer curve

[ laf-er ]

noun

, Economics.

1. a relationship postulated between tax rates and tax receipts indicating that rates above a certain level actually produce less revenue because they discourage taxable endeavors and vice versa.

Laffer curve

/ ˈlæfə /

noun

1. economics a curve on a graph showing government tax revenue plotted against percentage tax rates. It has been used to show that a cut in a high tax rate can increase government revenue

Word History and Origins

Origin of Laffer curve¹

1975–80; named after Arthur Laffer (born 1940), U.S. economist, who postulated it

Word History and Origins

Origin of Laffer curve¹

C20: named after Arthur Laffer (born 1940), US economist