Economics : An Integral Part Of Civilization Of The World

Whilst William McBride, chief economist for Tax Foundation website, sided with tax cut policy saying that to strengthen the financial state, “we should lower taxes on the earnings of capital,” “workers and the businesses that hire them,” Chye-ching Huang and Nathaniel Frentz, both are senior Tax Policy analysts, completely debunked the evidence McBride provided to support his argument, which includes the review of twenty-three among twenty-six studies he thought to advocate the idea. Indeed, as one conducts research, regardless of what sources it comes from, agreement over tax issue should never be found as a unanimous answer. One of the reasons why it is so difficult to reach a definite conclusion rests on the fact that although some statistics may show economic growth was in step with tax cut, correlation does not mean causation: just as ice-cream sale and murder rate increase during summer time, it is baseless to assume that higher ice-cream consumption leads to higher odds for crime. Moreover, because there is a great amount of research has been done on taxes, different interpretations from these data are understandable. Before concluding that “nearly every empirical study of taxes and economic growth published in a peer reviewed academic journal” finds cutting taxes improves the financial status quo, thus, people need to consider

Economic fallacies are very prevalent in our society because most of them make some logical sense. Before entering this class, I haven't thought much about what, if any, economic fallacies I believed in. But looking back, I certainly do recognize certain fallacies that I thought to be true before the start of the semester. Two really stick out: the broken window fallacy and the minimum wage. After going over them in class I was finally able to see that they were actually illogical conclusions and that I believed them.

In America, many people are completely unaware of how much their daily lives are affected by the economy, and vice versa—how much they as individuals can affect the economy. The general public’s ignorance of economics is extremely counterproductive because many problems in this country could be solved if everyone had a basic understanding of economic principles. However, economics can be difficult to understand, and therefore, people tend to avoid the topic whenever possible. In an effort to overcome the confusing nature of economics, Miranda, a twenty-two year old who works in retail and attends college in an effort to achieve a bachelor’s degree in business, will be used as an example. Upon observing Miranda as she goes about her day, it will become clear that several economic principles are at work in her daily life. This application of economics to simple, everyday situations will make economic principles easier to understand.

Federal Reserve has two other tools that it can use to change the money supply.

The federal income tax system is an intricate system and increases its complexity through newly enacted laws and regulations. The tax codes are difficult to decipher; however, it is a system that maintains the development of an entire country. The political aspects serve to focus on major loopholes and develop strategies for improvements. The laws and regulations highly coincide and work cohesively to obtain its objectives. Undoing or restructuring the federal tax system would cause a major disruption on economic and social terms (Prescott, & Hardin, 2013).

This book is filled with completely polarizing chapters in which the two things discussed seemingly have nothing to do with each other, but the authors find a way to connect them. In this summary, I will take you through some of the highlights of my favorite chapters and some of the more important chapters as well. The interesting thing about the book as a whole is that it does not even seem like you are reading a book that is trying to teach you economics through some outrageous situations. Another intriguing thing about this book is that these authors have such an extensive knowledge of studies that they can pull from any study, even if it has nothing to do with what they are talking about, and they can make it relevant.

The three chapters that we studied this week highlighted many important principles in the study of Economics. One of those concepts is the

Many services offered to the public are funded by theses taxes, which could not be administered successfully under some other arrangement. Taxes are defined as an obligatory subsidy to state income. These subsidies are imposed by the local, state, and federal governments on workers wages and business’s financial gains or added to the cost of some

Taxes are a necessary component for operating a government, however, they are also the source of great debate within our society. Especially when considering what types of taxes to use, and how much to tax the population without negatively impacting the economy. Income taxes are currently one of the biggest sources of income for the government, but are also one of the biggest concerns given the level of complication involved with the current tax system. Although many argue that the current progressive tax system contributes to our country’s economic growth, research indicates there may be benefits for simplifying the income tax system without stalling growth. One theory indicates implementing a flat tax system would not only provide consistency for businesses and consumers, it would positively impact economic growth. If given the appropriate considerations, including an equitable rate, a flat tax would increase consumer confidence and lead to an increase in consumption, and ultimately growing real gross domestic product (GDP).

Income tax is considered to be one of the greatest ways that a country amasses wealth through known means from the public in order to use the funds for the benefit and welfare of the community. Since a very long time, there have been many discussions and debates on the way the finds collected for income tax have been spend. There are many who think that there is a lot of mismanagement and feel that the amount of the actual money spent on welfare of the community is far less that what gets collected by the country.

Taxation is by which governments finance their expenditure by requiring costs on corporate entities and citizens. The government uses tax to discourage or encourage certain economic choices. Example, reduce in taxable personal or household rent by the amount paid as interest on home contract loans results in greater construction activity and generates more jobs. An essential function of taxation is to support government expenditures. Different justifications and explanations for taxes have offered throughout history. New taxes were used to support ruling classes, raise armies and build defenses. Often, the authority to tax stemmed from a divine or supranational right. Taxes are significant source of revenue, and its collection is one of the most important functions performed by the state

In the article Tax reform =Growth, the author Rory Meakin (2012) suggests that Australia has a good tax system but it still has its problems. He compares the tax system between Britain and Australia as well, and discusses the importance for the government to change its approach of raising taxes to make it cheaper, fairer and more legitimate in Australia. The article outlines the complexities of the taxation system in the country, which resulted to the lost of its legitimacy since many people do not understand how much they should pay. It advises the need for the government to make the tax system to be as neutral as possible by eliminating complications that will add confusion to its approach. The journal name tax reform equals to growth and he totally agrees that raising the tax and keeping the tax neutral is the better way to face the tax problems nowadays.

An income tax is not only costly in the amount of time and money it takes to file the paperwork correctly but, it also stunts economic growth as “income taxes are levied on work, savings, and investments. In essence, the government grows by taking money from what makes the economy grow” (Bedard 2010). A consumption tax on spending for goods and services that does not unduly burden the poor nor penalize savings and investments would be a sensible upgrade for the tax policy currently in place. Initially, this essay will discuss issues within the current income and corporate tax codes. The essay will then shift to reforms of the

Many people think that economics is about money. Well, to some extent this is true. Economics has a lot to do with money: with how much money people are paid; how much they spend: what it costs to buy various items; how much money firms earn; how much money there is in total in the economy. But despite the large number of areas in which our lives are concerned with money, economics is more than just the study of money.

Some of the most compelling topics that I learned in this topic only came into focus at the end of the course. Economics is a very large and complex study and reflecting on this subject, piece by piece, requires some patience and ability to put the pieces together. The relationships between simple choices, such as supply and demand, drives all economic and commercial exchange but only through the lens of economic models that attempt to layout this system by combing mathematical principles and psycho-social evaluation. All in all, this was very interesting introduction to some of the complex drivers that propel society.