Three theories of economic growth are investigated using data for the US states. They are the ‘sclerosis' theory that redistributive coalitions slow growth, the ‘convergence’ theory which predicts faster growth in low-income economies, and the ‘supply-side’ theory emphasizing the disincentive effects of taxation. Simultaneous testing of these theories requires the use of a pooled cross-section time-series model which allows temporal variation in measures of income growth, sclerosis, and taxes. Each theory has some empirical support for the period 1961–84.
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