The substitution effect of a tax-induced decline in wages always leads workers to work less.

Name: The substitution effect of a tax-induced decline in wages always leads workers to work less.
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The substitution effect states that when the wage rate falls, workers are less willing to supply their labor and will substitute leisure time (work less) for labor. Therefore, a tax-induced decline in wages will result in the substitution effect leading workers to work less.

The Substitution Effect of a Tax-Induced Decline in Wages Always