It's logically possible that wage or benefit increases are absorbed by price changes. There is no other reason to believe it, from what I've seen & heard.
>
>
>>> Therefor, yes if "a" in your formula is the value of higher prices
>>> (especially rents), then it will indeed equal any TC.
>
>> If. But there's no evidence. Nobody has even thought it an important
>> enough possibility to investigate it.
>
> You say there is no evidence, I have not read every conceivable study to
> know that.
> In anycase, who gets to decide what investigations to fund?
>
> Off the top of my head, Daniel Bell's research on collective bargaining,
> while not
> directly related, is instructive here. In "The Subversion of Collective
> Bargaining" Bell shows that wage increases earned through collective
> bargaining
> are always subsequently absorbed by price increases, and thus never in fact
> change the general level of real wages relative to rents and interest, only
>
> the structure as certain groups, as some wage-earned make gains against
> others.
>
> I see no reason to suspect that nominal net wage increases from some tax
> credit scheme will wash out any differently.
>
> Well, except that, being more uniform, such schemes allow less potential
> for
> even structural gains by some workers against others.
>
>
>>> "It is sometimes said it would illogical for labour to resist
>>> a reduction of money-wages but not to resist a reduction of
>>> real wages [...] experience shows that this is how labour
>>> in fact behaves"
>>> -- John Maynard Keynes,
>>> The General Theory of Employment, Interest, and Money
>
>
>