Trickle Down Theory

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Trickle Down Theory

An informal term for a macroeconomic theory that a government can best promote growth by providing incentives for persons to produce goods and services. The primary way a government does this is by maintaining low tax rates so that investors and entrepreneurs may invest their money in production. Maintaining low tax rates on the wealthy is one of the most important and controversial aspects of trickle down theory; the theory states that if well off persons have the capital available to produce goods and services, they create jobs and thereby grow the economy. In other words, the growth "trickles down" from the wealthy to the remainder of the economy. Critics contend that this does not happen in reality and that the wealthy are more likely to keep, rather than invest, their money. In the United States, trickle down theory was crucial to the economic policy of the Ronald Reagan administration. See also: Keynesian economics, Monetarism, Thatcherism.
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History has shown us time and again that trickle-down economics does not work.
But the administration's approach relies on trickle-down economics, over-hyped projections for growth and economic nationalist rhetoric that is utterly ahistorical.
Trickle-down economics, they claim, will ensure that, ultimately, the entire population benefits economically.
Mr Uhuru Kenyatta's approach is a continuation of the status quo, avoiding tackling the issues of justice, corruption, fairness and equality while focusing on massive projects within the ambit of his Big Four Agenda, an iteration of trickle-down economics.
The economists, especially ones who favor TRAIN, are virulently ideological especially on trickle-down economics, low taxes for the wealthy and neoliberal policies of deregulation, liberalization and privatization.
The government's argument that the trickle-down economics have not worked has seemingly gained public approval.
Once you realize that trickle-down economics does not work, you will see the excessive tax cuts for the rich as what they are - a simple upward redistribution of income, rather than a way to make all of us richer, as we were told.
They have seen enough of trickle-down economics to know that the benefits never flow to them.
This version of tax reform shows that today's Republican Party is still most united when it is cutting taxes for very rich people, raising taxes on the poor and the middle class, and placing its hope in the myth of trickle-down economics.
Trickle-down economics has been debunked in the past generation, but trickle-through economics has not been similarly challenged.
The campaign discusses current problems: the rules that made Australia fair are broken; inequality in Australia is at a 70-year high; trickle-down economics have just made the rich richer; jobs have been casualised; and wage growth is the lowest since records began.
There have been growing voices during the past couple of years that criticize trickle-down economics and its effects on economic inequality and how that affects growth and social stability, even by the same institutions that promoted it.