Exercise 22.15. (1) Prove Proposition 22.17. (2) Now suppose that in this proposition is not equal

Exercise 22.15. (1) Prove Proposition 22.17. (2) Now suppose that in this proposition φ is not equal to 0. Provide an example in which in the MPE, the elite would still prefer g = 0. (3) Now suppose that the elite can charge lump-sum taxes to middle-class entrepreneurs. Provide an example in which in the MPE, the elite would still prefer g = 0. (4) In light of your answers to 2 and 3 above, explain why the political equilibrium might involve the use of inefficient fiscal instruments, even when more efficient alternatives exist. Exercise 22.16. * Prove Proposition 22.18.