The Power Of Negative Thinking: Government Regulation And Economic Performance
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Overview: This paper from Washington University in St. Louis describes to sum up the response of the economy to supply-oriented tax policy will be greatly enhanced by reducing the numerous regulatory obstacles to economic activity. Failure to eliminate or at least substantially cut back the regulatory inhibitions to work, invest, and produce will result in disappointing returns from tax policy changes. Government policymakers must come to realize the lack of symmetry in the two different policy mechanisms: tax changes can provide strong incentives to undertake private economic activity, but regulation can provide a simple but effective veto.