TAXES NEW

Give two specific examples of how taxes and or government programs can effect incentives according to wheelan?

Taxing behavior that generates a negative externality creates a lot of good incentives. For example, if the government charges more dollars for gas every day, people will have less incentives to drive a car to work, or get a more fuel efficient car. No one would like to drive a car every day and fill up on gas every other day. If one does get a fuel efficient  car, it will be easier on the driver money wise. Another example is welfare programs. Welfare programs are ways to get easier money when you are not financially stable. For instance, a single mom with two kids would be eligible to participate in a welfare program and get money easier. This program gives people who have finance problems less of an incentive to work seeing that they can get easy money from the government. There are good and bad incentives in which the government causes towards the citizens of the US in which effect the economy in a harsh way.