Reduction of marginal tax rates undertaken explicitly to increase incentives of innovate, take risks, and work hard would be an example of

Question

Quizplus · Accepted Answer

Reduction of marginal tax rates is one of the core principles of supply-side economics, which focuses on promoting economic growth by incentivizing work, investment, and entrepreneurship through tax and regulatory policies. By reducing taxes on income, capital gains, and corporate profits, individuals and businesses have more resources to invest, innovate, and expand their operations, which can lead to higher output, employment, and incomes over time. This approach is often associated with conservative and libertarian political ideologies and has been implemented in various forms by administrations such as Reagan and Trump. In contrast, Keynesian economics emphasizes the role of government spending to stimulate demand and stabilize the economy during recessions, while progressivism emphasizes social justice and redistribution of wealth as a means of reducing inequality and improving well-being.

Reduction of Marginal Tax Rates Undertaken Explicitly to Increase Incentives