When President Ronald Reagan began his first term in 1981, the US economy was struggling.
Unemployment rates were high and getting higher, and in 1979, inflation had peaked at an all-time high for peacetime.
In an effort to combat these issues, Reagan's administration introduced a number of economic policies, including tax cuts for large corporations and high-income earners.
The idea was that tax savings for the rich would cause extra money to trickle down to everyone else, and for that reason, these policies are often referred to as trickle-down economics.
From the 80s to the late 90s, the US saw one of its longest and strongest periods of economic growth in history.
Median income rose, as did rates of job creation.
Since then, many politicians have invoked trickle-down theory as a justification for tax cuts — but did these policies actually work, either in the sense of stimulating economic growth, or in terms of improving circumstances for Americans?
Would they work in other circumstances?
To answer these questions, the main things to consider are whether the impact of the tax cut on the government's tax revenue is harmful, whether the money saved in taxes actually stimulates the economy, and whether stimulating the economy actually improves people's lives.
The idea behind tax cuts is that if taxes are too high, people will be less willing to work, which would ultimately decrease tax revenue.
