« Are Welfare Programmes Just Keeping People Out of Work? »

Tax to GDP ratios in the past 100 have risen substantially. One of the reasons for this is that taxes are used to fund welfare programmes. But what if giving people this access to these programmes, makes some of them want to try scam the system? A “moral hazard” effect.

A lecture at the LSE looks into it:

Let me summarize the claims in the lecture: Does this, moral hazard effect, make a difference? Yes. What is the magnitude if these effects? Mostly small. But have a look at the lecture. It’s worth it.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s