This is so so bad. Amazing to think people like Mundell, Friedman, Hayek, Buchanan, Coase, Prescott, etc, used to work with Cato. Anyway: the main point of payroll cuts is exactly to discourage layoffs - to help with nominal downward rigidity.
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Reducing cost of labor -> employment creation -> less unemployed. There's plenty of literature on this. Cf Elmendorf's testimony https://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/118xx/doc11874/09-28-economicoutlook_testimony.pdf …pic.twitter.com/fpLc520hke
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