Dynamic Analysis, Welfare, and Implications for Tax Reform

I work on a wide range of economic policies. While each area raises unique issues, the ultimate question in analyzing any of them is the same: what impact will this policy have on welfare? In many of the topics I work on, there is not a well-developed, coherent framework for answering that question. As a result, we often have to rely on heuristics: what stimulus measure has the most bang-for-the-buck? What training program results in the highest earnings? What intellectual property regime increases the quality of patents? In this regard, all of you working in public finance are lucky: you have a well-specified, coherent framework for assessing the welfare impacts of changes in tax policy, a framework that many of you here have helped to build and improve.