Wealth Taxes Cause Modest Economic Losses

Using Scandinavian administrative data, the new AER paper finds that a 1 percentage‑point rise in the top wealth tax reduces the number of wealthy taxpayers by about 2 percent and—through owner out‑migration—lowers employment by ≈0.02%, investment by ≈0.07% and value added by ≈0.10%. The magnitudes are small in aggregate but concentrated among business owners, implying distributional and firm‑level consequences beyond headline revenue figures. — Provides concrete, empirically grounded trade‑offs for policymakers weighing wealth taxes: migration of wealthy owners is real and imposes measurable (if modest) macro and firm‑level costs.