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    hey guys,
    am looking for solid evaluations on tax, subsidies and gov interventions please
    thanks a load
    Tom
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    (Original post by cool308)
    hey guys,
    am looking for solid evaluations on tax, subsidies and gov interventions please
    thanks a load
    Tom

    -You could talk about which households are affected the most (e.g. lower income households affected the most by a rise in tax)

    -Government failure arising from government interventions

    -Opportunity cost for subsides and what else it could have been spent on

    -Effects on other markets

    and link to current news articles that involve any of these


    hope this helps
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    a tax on a demerit good, may be ineffective. Due to the nature of de-merit goods, demand tends to be price inelastic. Therefore producers are able to pass the costs directly onto consumers. This just leads to a loss of consumer welfare, less purchasing power etc. Standard of living falls, distribution of wealth becomes more unequal since poorer people are paying a higher percentage of their income now. Whilst a 2£ extra price is likely to be insignificant for richer people. tax vs a min price floor. money generated from tax could be invested into educating people about dangers of demerit goods etc or whatever is being taxed.
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    thanks guys
 
 
 
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