One of the major criticisms of the supply-side emphasis on tax cuts as a way to stimulate the economy is that such cuts affect aggregate demand more than they do aggregate supply.

Question

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Supply-side tax cuts are intended to increase aggregate supply by incentivizing production and investment. However, critics argue that they often primarily boost aggregate demand by increasing disposable income, leading to higher consumption rather than significantly enhancing productive capacity.

One of the Major Criticisms of the Supply-Side Emphasis on Tax