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That's the opposite of how tax incidence works. Elasticity means you can change your amount produced in response to changes in price. Producers can’t easily c
by mlyle 1y ago
That's the opposite of how tax incidence works.
Elasticity means you can change your amount produced in response to changes in price.
Producers can’t easily change output, so they bear more of the tax burden themselves. But in the long run, producers can reallocate or exit until they’re producing at minimum(average total cost), which makes supply more elastic and shifts most of the burden onto consumers.
This is stuff that's covered in week 4 of a basic microeconomics class. It gets a little fancier with imperfect competition or heterogenous agents, etc, but predicting tax incidence is basically dominated by this even in advanced microeconomics.
- tsunamifury 1y agoSure ok. You’re being weirdly belligerent.
- mlyle 1y agoYou came here in your first comment blindly disagreeing with "This is your missing analysis." Then you seemed determined to misunderstand, e.g. > > But it's hard to escape your consumers paying most or all of the costs of those tariffs. > I think we agree if I'm understanding you correctly, yes the Suppliers have more elasticity and must ultimately absorb this. This is really simple fundamental microeconomics stuff. If you want to understand it, there's plenty of sources online. If you want to argue it, you should learn the basics first.
- tsunamifury 1y agoLiterally not arguing with you, asked a few questions and made open statements and tried to listen. Consider if you see everyone around you as the asshole who the asshole might be...
- mlyle 1y agoI think "this is your missing analysis" is a strong assertion to make to another human-- that sounds like an invitation to argue the merits. Through text, we don't have the benefit of tone. If your intention was to be curious about it, your comments don't convey that. > Consider if you see everyone around you as the asshole who the asshole might be... And now you're just effectively calling names. If you want to talk about economic concepts in a forum like this, you should either ask questions or fill yourself in on the foundational knowledge.
- tsunamifury 1y agoYou’re really wound up. Jsut consider that. Most people would not consider “this is missing” fighting words. Take a moment a think about yourself here. Really. “Shut up and don’t ask questions” is a very toxic behavior. Really. Think. About. This.
- mlyle 1y ago> You’re really wound up. Jsut consider that. It's hard to read emotions via text. I'm reading that -you- seem to be, with periods between each word, short phrases, &c. > “Shut up and don’t ask questions” is a very toxic behavior. c.f. > > If you want to talk about economic concepts in a forum like this, you should either ask questions or... It just seems like you're not reading the things I say.
- tsunamifury 1y agoThis is getting comical.