Maximum wages rate has become a consideration for many governments in all around the world. Majority of people believe that the maximum salary should not be limited considering the benefits to the economy. This phenomenon, however, is illusory for some people due to the facts that the inequality gap could be worse. This essay will discuss and scrutinize both of the point of views.
To begin with, it is apparent that high salary will create a better competition among employees. This will create a good work environment as the people work harder to gain their earning. Furthermore, when many companies could guarantee the merit system for their workers, the productivity will increase and boost the supply-side. On the other hand, because the earning is also climbed up, citizens would have a better ability to buy products, which absolutely support the demand-side. Based on the Keynes theory, the greater the level of supply and demand, the higher the economic growth is. Although wages is not the only determinant for the economic growth, it is obvious that wages rate plays a significant role.
On the other hand, when the government does not limit the maximum wages. the wider inequality gap would be created. When the poor are not able to continue education because of the unequal state-budget redistribution, the unemployment rate will rapidly surge. This is because the salary gap between the rich and the poor are very different, so the school and university are prefer to choose the rich by increasing their tuitition fees. As a consequence, if the unemployment rate rise, the crime rate will also rocket and threat the country's citizen.
As a conclusion, I personally believe that competition among employees is crucial for the economy by not limiting the maximum salary. However, the governments ought to regulate a better budget redistribution, for instance, by imposing a wealth tax or a regressive personal income tax and giving incentives to the poor through subsidy.
Comments:
Maximum wages
rate
has become a consideration for
many
governments
in all around the world. Majority of
people
believe that the maximum
salary
should not
be limited
considering the benefits to the economy. This phenomenon,
however
, is illusory for
some
people
due to the facts that the inequality gap could be worse. This essay will discuss and scrutinize both of the point of views.
To
begin
with, it is apparent that high
salary
will create a better competition among employees. This will create a
good
work environment as the
people
work harder to gain their earning.
Furthermore
, when
many
companies
could guarantee the merit system for their workers, the productivity will increase and boost the supply-side.
On the other hand
,
because
the earning is
also
climbed up, citizens would have a better ability to
buy
products, which
absolutely
support the demand-side. Based on the Keynes theory, the greater the level of supply and demand, the higher the economic growth is. Although wages is not the
only
determinant for the economic growth, it is obvious that wages
rate
plays a significant role.
On the other hand
, when the
government
does not limit the maximum wages.
the
wider inequality gap would
be created
. When the poor are not able to continue education
because
of the unequal state-budget redistribution, the unemployment
rate
will
rapidly
surge. This is
because
the
salary
gap between the rich and the poor are
very
different
,
so
the school and university are
prefer
to choose the rich by increasing their
tuitition
fees. As a consequence, if the unemployment
rate
rise, the crime
rate
will
also
rocket and threat the country's citizen.
As a conclusion, I
personally
believe that competition among employees is crucial for the economy by not limiting the maximum
salary
.
However
, the
governments
ought to regulate a better budget redistribution,
for instance
, by imposing a wealth tax or a regressive personal income tax and giving incentives to the poor through subsidy.
Comments: