Dynamic scoring

Dynamic scoring is a method used to estimate the economic impact of policy changes, like tax reforms. Unlike static scoring, which assumes no behavioral changes occur, dynamic scoring takes into account how people and businesses might adjust their actions in response to new laws. For example, if a tax cut is introduced, people may spend more, potentially boosting economic growth and increasing tax revenue. This approach aims to provide a more comprehensive picture of how policy changes can influence the economy over time, recognizing that human behavior can affect financial outcomes.