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According to the supply-side view of fiscal policy, if the impact on total tax revenues is the same, does it make any difference wether the
According to the supply-side view of fiscal policy, if the impact on total tax revenues is the same, does it make any difference wether the government cuts taxes by either reducing marginal tax rates or increasing the personal exemption allowance?
No, both methods of cutting taxes will exert the same impact on aggregate supply??
No, people in both cases will increase their saving, expecting higher future taxes, and thereby offset the stimulus effect of lower current taxes.
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