Difference between revisions of "Trickle down theory"
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(give benefits to the rich, on the assumption that these benefits will trickle down to the poor? No one believes this) |
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'''Trickle down theory''' is the theory that cutting taxes for the corporations and wealthy individuals will stimulate economic growth by increasing the amount of capital available to invest. Some argue that cutting taxes to the poor has a greater effect on the economy since almost all the money that they earn goes directly to buying products and services. President [[Ronald Reagan]] was a proponent of trickle down economics. | '''Trickle down theory''' is the theory that cutting taxes for the corporations and wealthy individuals will stimulate economic growth by increasing the amount of capital available to invest. Some argue that cutting taxes to the poor has a greater effect on the economy since almost all the money that they earn goes directly to buying products and services. President [[Ronald Reagan]] was a proponent of trickle down economics. | ||
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| + | Actually, as economist [[Thomas Sowell]] points out, | ||
| + | *there is no such thing as "trickle-down" economics. Supposedly those who believe in trickle-down economics want to give benefits to the rich, on the assumption that these benefits will trickle down to the poor. | ||
| + | *no economist of the past two centuries had any such theory.<ref> [http://townhall.com/columnists/thomassowell/2005/03/31/stupidity_trickling_down Stupidity trickling down]</ref> | ||
==See also== | ==See also== | ||
Revision as of 13:28, December 5, 2016
Trickle down theory is the theory that cutting taxes for the corporations and wealthy individuals will stimulate economic growth by increasing the amount of capital available to invest. Some argue that cutting taxes to the poor has a greater effect on the economy since almost all the money that they earn goes directly to buying products and services. President Ronald Reagan was a proponent of trickle down economics.
Actually, as economist Thomas Sowell points out,
- there is no such thing as "trickle-down" economics. Supposedly those who believe in trickle-down economics want to give benefits to the rich, on the assumption that these benefits will trickle down to the poor.
- no economist of the past two centuries had any such theory.[1]