Cutting corporate tax rates is not associated with gains in median wages: Percentage-point change in state corporate income tax rate and annualized growth in median wages, 1980–2010
| Corporate rate | Median wage | Population (weight) |
|---|---|---|
| 1.5% | 0.4% | 4.80E+06 |
| 0.0% | -1.0% | 710231 |
| -3.5% | 0.2% | 6.30E+06 |
| 0.5% | 0.5% | 2.90E+06 |
| -0.8% | 0.2% | 3.70E+07 |
| -0.4% | 0.4% | 5.00E+06 |
| -2.5% | 0.8% | 3.60E+06 |
| 0.0% | 0.7% | 897934 |
| 0.5% | 0.7% | 1.90E+07 |
| 0.0% | 0.7% | 9.70E+06 |
| 0.0% | 0.2% | 1.40E+06 |
| 1.1% | 0.1% | 1.60E+06 |
| 0.8% | -0.1% | 1.30E+07 |
| 2.5% | 0.1% | 6.50E+06 |
| 2.0% | 0.2% | 3.00E+06 |
| 0.3% | 0.3% | 2.90E+06 |
| 0.0% | 0.3% | 4.30E+06 |
| 0.0% | 0.1% | 4.50E+06 |
| 2.0% | 0.8% | 1.30E+06 |
| 0.0% | 0.5% | 5.80E+06 |
| -0.8% | 0.9% | 6.50E+06 |
| 2.6% | -0.2% | 9.90E+06 |
| -2.2% | 0.5% | 5.30E+06 |
| 1.0% | 0.4% | 3.00E+06 |
| 1.3% | 0.3% | 6.00E+06 |
| 0.3% | 0.1% | 989415 |
| 3.3% | 0.4% | 1.80E+06 |
| 0.0% | 0.0% | 2.70E+06 |
| 0.5% | 0.9% | 1.30E+06 |
| 0.0% | 0.7% | 8.80E+06 |
| 2.6% | 0.3% | 2.10E+06 |
| -2.9% | 0.5% | 1.90E+07 |
| 0.9% | 0.6% | 9.50E+06 |
| -2.1% | 0.5% | 672591 |
| -8.0% | -0.1% | 1.20E+07 |
| 2.0% | 0.2% | 3.80E+06 |
| -0.5% | -0.1% | 3.80E+06 |
| 0.5% | 0.3% | 1.30E+07 |
| 1.0% | 0.8% | 1.10E+06 |
| -1.0% | 0.6% | 4.60E+06 |
| 0.0% | 0.6% | 814180 |
| 0.0% | 0.3% | 6.30E+06 |
| 0.0% | 0.1% | 2.50E+07 |
| 1.0% | 0.1% | 2.80E+06 |
| 1.0% | 0.8% | 625741 |
| 0.0% | 0.7% | 8.00E+06 |
| 0.0% | 0.1% | 6.70E+06 |
| 2.5% | 0.2% | 1.90E+06 |
| 0.0% | 0.2% | 5.70E+06 |
| 0.0% | 0.0% | 563626 |
Source: EPI analysis of data on state corporate tax rates from Juan Carlos Suárez Serrato and Owen Zidar, "Who Benefits from State Corporate Tax Cuts? A Local Labor Markets Approach with Heterogeneous Firms," American Economic Review, 106 (9): 2582-2624 [2016 working paper version] (summary data here). Data on state median wages from the Current Population Survey Outgoing Rotation Groups (ORG). Data is deflated using the CPI-U-RS. Data points weighted by state population in 2010.