The article examines how people's income changes in response to tax rate adjustments in Sweden from 1991 to 2002. By analyzing a large group of taxpayers, the researchers found that long-term income elasticity to tax rates is around 0.20 to 0.30, meaning income changes by 20-30% for every 1% change in tax rates. Short-term effects are smaller and less certain. A hypothetical 5% reduction in the top tax rate is predicted to have little impact on tax revenue, possibly even increasing it.