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Topic 3 DQ 2.docx - Topic 3 DQ 2 Does the United States'...

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Topic 3 DQ 2Does the United States' labor supply tend to be more elastic or more inelastic? Explain thecompeting theories discussed in the textbook. Which seems more convincing to you? Explainyour answerHello Dr. Michael and Fellow Classmates,I believe that the United States labor supply is more elastic because it would respond to changesin the state and government's tax rates. If labor supply is unaffected, that would indicate thathours worked would remain steady when taxes are raised or lowered and show a more inelasticsupply of labor (Prescott, 2002). Economic theory and data have proven that this notion of beingfalse, making the labor supply look more elastic. Given higher tax rates, the working class tendsto work more to make up for the monies lost in taxes, and businesses are not willing to give more
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Supply And Demand, government s tax rates

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