First of all, let me say that I think the question is wrong in the first place, and the reason it's wrong is that corporations don't pay tax. It's going to be either shareholders who get lower after-tax returns, or it's going to be workers who are not going to get as high wages.
The reason I raise that is that in today's global world, the one thing that corporate taxes don't do any more is get shifted back onto shareholders. The reason is that if you impose high corporate income taxes and it lowers the profits that are going to be paid to shareholders or to investors, then they'll take their money and go elsewhere around the world. So in the end, the corporation has to pay the same after-tax rate of return to shareholders as it would with or without corporate taxes.
Right now I'll get to some important studies that have recently come out. But what we have seen in the past number of years is that there is a growing body of evidence that corporate tax reductions actually do generate more and higher wages paid to workers.
A recent study done by Mike Devereux at Oxford University—quite a good one with a colleague—looked at the incidence of corporate income taxes in Europe and I think particularly in Britain. This was one of the first studies that had been done in quite a long time. He found that in the short run, if corporate taxes are reduced by $1, then wages increase by 50¢, and in the long run they increase by over 100%. The reason he got over 100% is that companies would invest in new technologies and that would increase the productivity of workers and then that would allow them to pay more wages to their workers. Or they would be able to reduce prices, and that would have the impact of increasing the purchasing power of wages.