A unique characteristic of taxes on economic rents is that such taxes

Question

Quizplus · Accepted Answer

Economic rents are the excess earnings that a resource (like land or patent) earns beyond what is required to keep it in its current use. Taxes on economic rents do not lead to a reallocation of the resource because they do not affect incentives for the owners of the resource. The owners would continue to earn the same rent regardless of the tax. Therefore, such taxes are efficient and do not lead to deadweight losses.

A Unique Characteristic of Taxes on Economic Rents Is That