Crazy bad econ here! "In a perfectly competitive economy … everyone gets paid … marginal product. …Why do we care how hard the rich work? If a rich man works an extra hour, adding $1000 to the economy, but gets paid $1000 … combined income of everyone else doesn’t change."https://twitter.com/paulkrugman/status/1081906768274513920 …
(taxes are better than such illnesses because they increase revenue, but my understanding is he's saying there's no negative effect here at all)
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Good explanation, thanks! Very curious about 2 things. Q: He may not see that, and agreed, that would seem a significant mistake - if it has a significant effect on motivation, or rather, on the actual productivity/taxable income; is that soundly researched anywhere? 1/2
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2: Doesn't motivational impact differ with diff views of taxes as burden or a way to finance sth good: awareness of benefits from tax revenue?
@paulkrugman may overlook motivation loss, but assume ~neutral motivat. impact because he sees benefits (& justifiability in good state)?
End of conversation
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