Which of the following would supply-side economists advocate?
I. reducing tax rates in order to encourage people to work more
II. providing investment tax credits to stimulate capital formation spending
III. increasing government spending
IV. increasing transfer payments to those who want to be retrained for employment

Question

Which of the following would supply-side economists advocate? 
I. reducing tax rates in order to encourage people to work more
II. providing investment tax credits to stimulate capital formation spending
III. increasing government spending
IV. increasing transfer payments to those who want to be retrained for employment

Quizplus · Accepted Answer

Supply-side economists believe that incentives play a crucial role in encouraging economic growth. Therefore, they typically advocate for policies that reduce tax rates in order to encourage people to work more and provide investment tax credits to stimulate capital formation spending. However, they would not advocate for increasing government spending or increasing transfer payments because they believe these policies would not provide the right incentives for economic growth.

Which of the Following Would Supply-Side Economists Advocate