The Laffer curve revisited

► Laffer curves for labor and capital taxes for the US and EU-14 economies are calculated. ► The US can increase revenues by 30% (6%) if labor (capital) taxes are raised. ► For the EU-14 we obtain 8% or 1% respectively. ► Tax cuts are more self-financing in the EU-14 than in the US. ► Implications of heterogeneity, transitions and human capital are examined.