Hello,
More of my philosophy about economy and the tax cuts and tax multiplier
and more..
I am a white arab, and i think i am smart since i have also
invented many scalable algorithms and algorithms..
I am posting again my following thoughts and writing since i think they
are important:
The tax multiplier is the magnification effect of a change in taxes on aggregate demand. The decrease in taxes has a similar effect on income
and consumption as an increase in government spending. However, the tax multiplier is smaller than the spending multiplier.
And there is greater agreement about tax multipliers. Because tax cuts strengthen the incentive to work and to invest, they increase aggregate
supply as well as aggregate demand. These multipliers get bigger as more
time elapses. Harald Uhlig says that after one year, the tax multiplier
is 0.5 so that the $300 billion tax cut would increase real GDP by about
$150 billion by early 2010. But with two years of time to respond, real
GDP would be $600 billion higher — a multiplier of 2. And after three
years, the tax multiplier builds up to more than 6. The implications of
the work of Barro and Uhlig are that tax cuts are a powerful way to
stimulate real GDP and employment but spending increases are not
effective. And notice that the tax cuts is part of a fiscal stimulus
that refers to increasing government consumption or transfers or
lowering taxes, increasing the rate of growth of public debt. Supporters
of Keynesian economics assume the stimulus will cause sufficient
economic growth to fill that gap partially or completely via the
multiplier effect.
More of my philosophy about to subsidize or not to subsidize companies..
I invite you to read the following interesting new article
about what Europe's $48 billion chips plan could do for quantum computing:
https://interestingengineering.com/europe-silicon-chips-funding-quantum-computing
I think i am smart, and i say that notice how the European Chips Act,
which still has to be approved by EU member states and lawmakers, would temporarily re-write strict rules that regulate when and how individual countries are allowed to subsidize industries within their borders, but
i say that notice carefully that this wanting of European Union to
subsidize Chips companies is due to chip shortage and supply chain
crisis that has injected instability into the global economy , so this
European Chips act is like the exception to the rule of subsidizing
companies, since European union is not going to sacrifice the advantages
of competition to do the same thing that others like China do, namely to subsidize companies. No, because European Union would sacrifice the idea
that the market is there to serve consumers with fairness and fair prices.
And i invite you to read my thoughts about the other economic problems
of China:
https://groups.google.com/g/alt.culture.morocco/c/WioBZfc066U
Thank you,
Amine Moulay Ramdane.
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