Not sure which example you are talking about. You seem to switch from trying to talk about analysis to examples whenver it suits you. Again you framed the question with only two options. The third, consumption. You need a demand for IT before it is worth investing in. If the demand is high enough, then the payoff from investing in IT becomes worthwhile even with a higher tax braket.
the above is how the debate started. I pointed out that progressive rates cause people to favor savings over investment. I do not address consumption. (I could have but that is not my concern.) You really can not argue the point I made. If 99% of your income over 1000 dollars is taxed and you are making 1000 dollars are you going to risk a portion of your money on startup companies. And I know you are smart enough to understand this is a generalization across a society of rational decision makers who attempt to maximize their utilities. Whether it be tech startups or widgets - the logic is the same.
Sure if you take the arguement to an extreme. Nobody is advacating a 99% tax level. At resonable levels, you get back to the question wether the substitution effect that you like, or the income effect prevails. As you said the evidence is pretty inconclusive.