ps3 - Economics 103C Professor Friedman Fall 2009-Problem...

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Economics 103C Emily Leung Professor Friedman Owen Thompson Fall 2009-Problem Set 3 Friday 12:20 1a. In the United States there are many different rights and privileges. Examples of these rights could be someone’s ability to make snowballs or sleeping is also a right. On the other hand examples of a privilege given only to the rich could be cable television, air conditioning, heat, or luxury cars. From these rights and privileges the democratic society would maintain these different forms of distribution because they 1b. Okun believes that if you tax on the rich then there will be less work by the rich because they believe that people substitute leisure for labor. Okun believes that greater equality will lead to lower economic efficiency because redistribution creates a wasteland bureaucracy. By reducing penalty for poverty, it encourages the poor to stay poor; and by reducing the rewards for being rich it encourages working less and being less productive. Along with these beliefs, Okun also assumes that the rich people will benefit from the substitution effect while the poor would
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ps3 - Economics 103C Professor Friedman Fall 2009-Problem...

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