New study reveals optimal tax strategy for boosting economy and reducing inequality
The article explores how external factors in different sectors can lead to suboptimal decisions in the production of goods. By introducing subsidies to human capital or a combination of taxes, the best solution can be achieved. Additionally, even with clear global outcomes, local uncertainties can still arise due to various parameter combinations. This means that identical economies may not reach the same levels of prosperity. The size and type of externalities in human capital play a crucial role in determining the best policies for economic growth.