Art Carden  

Taxes: Who Pays? My Latest from LearnLiberty

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Economics offers a lot of cool and counterintuitive insights. One of the most fun, I think, is the independence of the legal incidence and the economic incidence of a tax. In other words, if demanders are not very responsive to changes in the price of a good, sellers can pass some or even most of a tax on to demanders even when sellers are responsible for writing the check to the government.

In my latest suite of LearnLiberty videos, I explain tax incidence and the distortionary effects of taxation in the context of a handful of simple examples, some of which are literally taken from textbooks. Enjoy!

Disclosure: I have been compensated for appearing in LearnLiberty videos.


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CATEGORIES: Microeconomics



COMMENTS (4 to date)
Tom West writes:

A nice, clear introduction to tax incidence.

My only objection is the framing implies the motivation for taxing as fundamentally punitive (punish the tobacco/oil companies or the rich), which I suspect will detract from the educational prospects of the videos.

ThomasH writes:

I hope all those employers who have religious objections to their money going to pay for contraception coverage will see and understand that health insurance coverage is paid for with the employee's wages.

James writes:

ThomasH: You are 100% right. Contraception coverage comes out of the employee's wage. Why do you suppose no prominent defender of Obamacare has made the argument that mandated benefits are funded out of wages?

Floccina writes:

@ThomasH,
I think that we can safely assume that some Catholic employees of catholic employers also have religious objections to their money going to pay for contraception coverage.

The thing is that the employees with strong moral objections to contraception coverage will pay for some other employees contraceptives if the employer buys insurance that covers contraceptives.

BTW Contraceptives are cheap enough that it borders on absurd to mandate health insurance pay for them.

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