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What is the explanation for the principle of maximum social advantage?
Wiki User
∙ 11y ago
fghmarginal sacrifice are equal atg pointffh gfto point M, the social gain from public expenditure is gredgfaterghf hwhy is public financghhghe required than gfrom tfghaxes is greater than ghthe gain ghfrom public The theory of maximum social advantage is the fgSocial hprincipghlfhof maximum social ahdvantage pfggfhossesfdhses thghhe In other words, maximum fhfresult ghof two codhfghfghfghhfgfntragghfgdictory fd Different fh It is not be possible to compare the which tries to incrhfgjeasehgf it throughfgghexpenditure and the marginal benefits accruing to people in ghjghone area from a otheg hr which tries to decrease it through taxation. Thus social given public expenjtuhreghd with hfgthefgby persons who are taxed in some other area. public expenditure are npar e jgfgfthe advantage to the commu- 3. Differences in Standard of Livinghfghrevenue from shopkeeper and ajh gjhfgovernment employee. taxation to public expenditure by the state should continue up 4. Vague and abstract. The terms "benefit" and "sacrificefgthe vague andfgabhstract. It is not pofgle gfeasy. As put by Prof. Buchanan, than the sacrifice undergone by taxation. On the contrary, injhj "To matchf them is a function for the 'fiscal brain' or expenditure less tgan this point, the gaiggghfghfghfhnhg in utility would be computer." greater than the sacrifice from taxation. But the social advantage will not be g expenddhiture is increased to the 6. hj. There is the problem of calculating social point where the MU from a given publijhgjhjc expenditure equals the benefits from public expenditure on short period and lhgjhjhjgong marginal ghThis principle of maximum social advantage is explained periods. This is not an easy task. graphically in Fig. 1 in terms of Prof. Musgrave's diagram. Amounts of public hmarginal benefit along the horizontal axis, the marginal social benefit is mea- fromh0 upwards and tfghe marginal taxation, the resources are required to be divided into social fifice is measured below 0 on the vertgical axis. The smaller units. But it is not possible because of the lack of curve EE measures marginal social benefit to the society from divisibility of public ehjgjhjxpenditure and ftaxes to the government. The differ- consideration the sacrifice on the part of direct tax ghfdh-tax revenues. Non-tax revenues like fines, because EE is the gain to society from public expenditure and 1 fees, market borrowings, profits of public undertakings, etc. IT is the cost to society in the form of taxes paid. The net 1 are equally important as sources of revenue and in their sghjgfjhgjhghjgfjhghjocial advantagfghfge is shown by the NNghjj) curve. The marginal social effects on h,hgf the principle of maximum social hvantage is gfhthe best system of public finance", achjghjghjghcording to Dalton. 4. Objective Tests ofghmmunity against internal disorders and external attacks. The financial operations of the state to preserve the society in this jto Dalton, this can be achieved by improvements in g? hahaha you are stuffed up now
Wiki User
∙ 15y ago
Wiki User
∙ 14y agoprincipal of maximum of social advatage is a fundamental principal of
Wiki User
∙ 9y agoThe Principle of Maximum Social Advantage was introduced by a British economist Hugh Dalton. It is the fundamental principles of public finance.
Wiki User
∙ 11y ago4g0t
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