--- andie nachgeborenen <andie_nachgeborenen at yahoo.com> wrote:
> >
> > If you use progressive taxation to control the
> > accumulation of wealth, then you might take away
> the
> > incentive to work. It would be a matter of very
> > fine-tuning.
>
> There's a good deal of evidence that what matters to
> "incentive to work" is pretax income, actually.
>
> And then there's the obvious fact that if you
> reduce
> people's net income by taxation you give them an
> obvious incentive to work more so the net is higher!
> I
> think Geoffrey Hazard once wrote a paper about that,
> no one paid any attention.
>
> Also there's the curious point about diminishing
> marginal returns ("DMR") that advocates of unlimited
> accumulation never get. An extra 50 dollars is a lot
> of money to someone earning $33,000 a year, like
> teachers in Waukegan, IL, but because an extra
> million
> dollars is chicken feed to Bill Gates, it doesn't
> provide him any significant additional incentive to
> monopolize the software market and violate the
> antitrust law bundling bad software that you have to
> buy. So, if you think that people are mainly
> motivated
> to work by extra money, and you want people to work,
> you want your incentives front-loaded, progressivity
> is a reflection of this obvious fact.
>
> Fact is, we don't provide incentives to work,
> mainly,
> by giving more money, except to them as don't need
> it
> because (a) their jobs are relatively desirable,
> intrinsically rewarding, or compensated in
> nonmonetary
> terms (like prestige), or (b) because DMR means that
> extra money doesn't matter that much to them as
> income
> as opposed to a way of keeping score.
>
> We do it on the One Bullet Manager theory that
> Terrified People Are More Productive: for most
> people
> it's not the carrot of extra income, but the stick
> of
> joblessness and destitution that drives them to the
> rat race.
>
>
>
>
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