Asked by Michael Morales on Jun 17, 2024
Verified
Economists disagree on whether labor taxes have a small or large deadweight loss.
Deadweight Loss
An economic inefficiency that occurs when the total amount of losses in welfare or surplus exceeds the gains, often due to taxes or monopolies.
Labor Taxes
Financial obligations placed on workers or their employers, calculated as a portion of the salaries paid to employees.
- Grasp the variation in economists' perspectives on the effects of specific taxes.
Verified Answer
TP
Tilleri porterJun 18, 2024
Final Answer :
True
Explanation :
Economists have varying opinions on the magnitude of deadweight loss caused by labor taxes, with some arguing it is small and others believing it is large, due to differences in assumptions about labor supply elasticity and other factors.
Learning Objectives
- Grasp the variation in economists' perspectives on the effects of specific taxes.
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