Comparing Ibn khaldun ecnomics theory with laffer curve, Taxation Research Paper

Comparing Ibn khaldun ecnomics theory with laffer curve, Taxation - Research Paper Example Ibn Khaldun appears as a forerunner of the prominent American economist Arthur Laffer whose suggestion complements that high rates contract the tax base since decrease the economic activity (Ibn et al. 1969). According to Laffer, the relationship amid tax and revenues is that changes in taxes have effects on profits. Ibn Khaldun’s concepts are comparable to those of supply economics that emphasizes incentives and tax reduction as a way of economic development. Ibn Khalduns’ taxation theory is considered a unique and one of his most significant contributions to the economic policy. His tax theory has cemented a place in the world of economics. The paper attempts to table experimental evidence that can support and fortify his tax theory. It similarly introduces Ibn Khaldun’s exemplary work Muqaddimah as well as economic ideologies seen in his work. On another account, the essay seeks to examine Ibn Khalduns’s theory and the Laffer curve comparatively. The key objective of Ibn Khaldun’s theory of taxation is to reduce to the lowest level possible the levies upon individuals capable of undertaking cultural enterprises. Through this way, the individuals will psychologically dispose of themselves to undertake their activities because there is an assurance that they will make a profit at the end of the day. He, therefore, advocates reducing the burden of taxation upon business entities, as well as producers, in order to entice the enterprise through guaranteeing greater returns to the entrepreneur, as well as revenue to the government. In practice, he realized that the government depends on low taxes. And for that reason, the enterprises increase in the number as well as size therefore permitting the growth of the tax base, revenue, and governmental surplus (Ibn et al. 1969). At the conclusion of a dynasty, taxation produces massive income from small valuation. The reason thereby is that when family trails the means of religion , it executes