8 Agreement and disagreement among economists Suppose that R

8. Agreement and disagreement among economists Suppose that Raphael, an economist from an AM talk radio program, and Susan, an economist from a school of industrial relations, are arguing over saving incentives. The following dialogue shows an excerpt from their debate: Susan: I think it\'s safe to say that, in general, the savings rate of households in today\'s economy is much lower than it really needs to be to sustain an improvement in living standards Raphael: I think a switch from the income tax to a consumption tax would bring growth in living standards. Susan: You really think households would change their saving behavior enough in response to this to make a difference? Because I don\'t. The disagreement between these economists is most likely due to Despite their differences, with which proposition are two economists chosen at random most likely to agree? Minimum wage laws do more to harm low-skilled workers than help them. O Lawyers make up an excessive percentage of elected officials. O Tariffs and import quotas generally reduce economic welfare.

Solution

Income tax to a consumption tax as savings incentives is due to differences in scientific judgments since they are arguing about validity of positive theories. This is the correct answer.

Values is wrong because values are about fairness and equity. This argument is not about values.

Perception is what is the ideal situation and reality is what actual picture is. This is wrong.

Tariff and quotas is the answer.