Give two specific examples of how taxes and or government programs can effect incentives according to wheelan?
Taxes and government can effect incentives in a negative and positive way. Whenever you raise taxes in government programs, this sometimes discourages productive investments that make people better off in the world. In terms of the fiscal drag of taxes, taxes take money away which worsens power and utility. Also, Taxes cause individuals to behave in ways thats bad for the economy and doesn't provide new government revenues in which discourages work and investment.
Some of the government benefits sometimes create difficult incentives such as unemployment that diminish the incentive to work.
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ReplyDeletewhat you wrote here in no way indicates that you are applying what you read from Whelan. When you write things like "fiscal drag" it feels like you take in right off the internet.
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