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Unformatted text preview: less Taxes on buyers and taxes on sellers are equivalent They cannot truly legislate who the tax affects Payroll tax- ie FICA Tax wedge-moves wage received by workers down and wage paid out by employers up When supply is more elastic that demand the incidence of tax falls more heavily on consumers When demand is more elastic that supply the incidence of tax falls more heavily on suppliers A tax burden falls more heavily on the side of the market that is less elastic Labor is generally less elastic...
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This note was uploaded on 12/10/2007 for the course ECON 1110 taught by Professor Wissink during the Fall '06 term at Cornell.
- Fall '06