When the government attempts to improve equity in an economy the result is often

Question

Quizplus · Accepted Answer

When the government attempts to improve equity in an economy, it often involves redistributing income and resources from the more affluent members of society to those who are less well off. This can lead to a reduction in efficiency, as some individuals may lose the incentive to work hard and take risks, while others may become dependent on government support. In addition, the process of redistribution itself can be inefficient, involving high administrative costs and potential errors or corruption. Thus, while equity is an important goal, it needs to be balanced against the need for efficiency and growth in the economy as a whole.

When the Government Attempts to Improve Equity in an Economy