- support policies that promote GDP growth by arguing that high marginal tax rates along w/ current system of transfer payments (i.e. unemployment compensation and social security) provide disincentives to work, invest, innovate, and take entrepreneurial adventures
- believe AS curve will determine levels of inflation, unemployment, and economics growth
Trickle-down Effect:
*Rich→poor (direction of $ flow)
Marginal Tax Rate→amount paid on last $ earned or on each additional $ earned
- Reaganomics believe if you reduce the marginal tax rate, more people will be inclined to work longer, thus forgoing leisure time for extra income.
Hey Karen,
ReplyDeleteYour blog is very neat, and well divided. For supply-side economics, I would like to add that tax cuts are created to stimulate the economy and deregulating industries and banks would lead to an economic growth where the industry will invest in expansion and therefore increasing supply.
Ah, thank you for your comment! It will help people understand the concept better with your explanation of this relationship.
ReplyDeleteHi, Joe! Thank you for replying to my blog! The site you mentioned is very convenient, I wish I would've known about it during my senior year in Economics. It is indeed helpful. Thank you, and have a wonderful day!
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