Logout Open In App
Open In App
Warning: foreach() argument must be of type array|object, bool given in /var/www/html/web/app/themes/studypress-core-theme/template-parts/header/mobile-offcanvas.php on line 20

Chapter 15: Q.29 (page 378)

Describe how a push for economic equality might

reduce incentives to work and produce output. Then

describe how a push for economic inequality might not

have such effects.

Short Answer

Expert verified

Forcing economic equality may lead to compromise with economic output.

Step by step solution

01

Step 1. Meaning

Incentives to work

incentives to work in economic senses refers to the motivation to choose work over leisure.

02

Step 2. Explanation

Imposing high taxes on high earning groups can discourage them from working will impact incentives as well & there would be a decline in the output-oriented entrepreneur approach, for experiencing a high level of equality in distribution can lead low level of production.

03

Step 3. Explanation

On another side, allowing economic inequality by letting people earn as much they can lead to a high incentive to work because high earning people attract people to earn more & individuals tends to work more leads to inequality.

Unlock Step-by-Step Solutions & Ace Your Exams!

  • Full Textbook Solutions

    Get detailed explanations and key concepts

  • Unlimited Al creation

    Al flashcards, explanations, exams and more...

  • Ads-free access

    To over 500 millions flashcards

  • Money-back guarantee

    We refund you if you fail your exam.

Start your free trial

Over 30 million students worldwide already upgrade their learning with Vaia!

One App. One Place for Learning.

All the tools & learning materials you need for study success - in one app.

Get started for free

Most popular questions from this chapter

If a family of three earned $20,000, would they

be able to make ends meet given the official poverty threshold?

Briefly explain the differences between TANF, the earned income tax credit, SNAP, and Medicaid.

Consider two of the income security programs in the United States: Temporary Assistance for Needy Families (TANF) and the Earned Income Tax Credit (EITC).

a. When a woman with Children and very low income earns an extra dollar, she receives less in TANF benefits. What do you think is the effect of this feature of TANF on the labor-supply of low-income women? Explain.

b. The EITC proves greater benefits as low-income workers earn more income (up to a point). What do you think is the effect of this program on the labor-supply of low-income individuals? Explain.

c. What are the disadvantages of eliminating TANF and allocating the savings to EITC?

Many critics of government programs to help low-

income individuals argue that these programs create a poverty trap. Explain how programs such as TANF, EITC, SNAP, and Medicaid will affect low-income and whether or not you think these programs will benefit families and children.

What are some reasons why a certain degree of

inequality of income would be expected in a market

economy?
See all solutions

Recommended explanations on Economics Textbooks

Taxation Economics

Read Explanation
View all explanations

What do you think about this solution?

We value your feedback to improve our textbook solutions.

Study anywhere. Anytime. Across all devices.

Sign-up for free