The tax cuts of the Trump administration presumed that income tax cuts would stimulate incentives to work

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The tax cuts of the Trump administration presumed that income tax cuts would stimulate incentives to work and thereby increase economic growth. Demonstrate this outcome with a work–leisure diagram. What does this outcome assume about the relative sizes of the income and substitution effects? Explain: “The predicted increase in work incentives associated with tax cuts might in fact be more relevant for women than for men.”

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Contemporary Labor Economics

ISBN: 9781260570625

12th Edition

Authors: Campbell McConnell, Stanley Brue, David Macpherson

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