Headlines at Hopkins: news releases from across
university Headlines
News by Topic: news releases organized by subject News by Topic
News by School: news releases organized by the 
university's 9 schools & divisions News by School
Events Open to the Public (campus-wide) Events Open
to the Public
Blue Jay Sports: Hopkins Athletic Center Blue Jay Sports
Search News Site Search the Site

Contacting the News Staff: directory of university 
press officers Contacting
News Staff
Receive News Via Email (listservs) Receive News
Via Email
Resources for Journalists Resources for Journalists

Virtually Live@Hopkins: audio and video news Virtually
Hopkins in the News: news clips about Hopkins Hopkins in
the News

Faculty Experts: searchable resource organized by 
topic Faculty Experts
Faculty and Administrator Photos Faculty and
Faculty with Homepages Faculty with Homepages

JHUNIVERSE Homepage JHUniverse Homepage
Headlines at Hopkins
Media Advisory

Office of News and Information
Johns Hopkins University
3003 N. Charles Street, Suite 100
Baltimore, Maryland 21218-3843
Phone: (410) 516-7160 | Fax (410) 516-5251

July 6, 2001
CONTACT: Glenn Small

Media Advisory
To: Reporters, Editors, Producers
From: Glenn Small, 410-516-6094, glenn@jhu.edu
Re: Effect of Bush Tax Refund on Consumer Spending and the Economy

Notices are going out to millions of Americans letting them know they're due to receive a tax refund check in the coming weeks and months. But a Johns Hopkins economist who has studied consumer reaction to tax cuts in Japan says we shouldn't expect to see any rapid impact on the economy as a result of the tax windfall.

"The reaction to tax cuts tends to be rather sluggish," said Christopher Carroll, a professor of economics at The Johns Hopkins University. Carroll has written a paper for a forthcoming edition of the International Economic Journal that looks at the consumer reaction to permanent tax cuts in Japan.

While Carroll's work focuses on Japan, he said the logic applies to the United States as well. He said the evidence suggests that consumer spending is determined partly by habits which take some time to adjust to new circumstances, including tax cuts. While a modest percentage of households may spend their tax cut immediately, it may take a year or more before aggregate consumer spending has mostly adjusted to the tax cut.

Carroll has published research on the relationship between confidence and economic forecasting in the American Economic Review and other top economics journals. His research in this area stems from his former job as a staff economist at the Federal Reserve Board. He has been called on to explain how consumer confidence rises and falls and how it affects the economy on such shows as The Diane Rehm Show and ABC News' Nightline.

To arrange for an interview with Carroll, you may e- mail him at ccarroll@jhu.edu or call him at 410-516-7602.

Johns Hopkins University news releases can be found on the World Wide Web at http://www.jhu.edu/news_info/news/
   Information on automatic e-mail delivery of science and medical news releases is available at the same address.

Go to Headlines@HopkinsHome Page