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During the administration of George W. Bush, reductions in the tax rates on labor income, dividends, and capital gains were the centerpiece of fiscal policy. Analyze the macroeconomic effects of such tax cuts within the new classical model.

During the administration of George W. Bush, reductions in the tax rates on labor income, dividends, and capital gains were the centerpiece of fiscal policy. Analyze the macroeconomic effects of such tax cuts within the new classical model.

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