Redistribution Through the Public Sector Tends to Lower Economic Prosperity

Multiple Choice

Redistribution through the public sector tends to lower economic prosperity because

A) it weakens the link between productive activity and the reward derived from it.
B) it encourages resources to flow into wasteful rent-seeking activities.
C) the higher tax rates required to finance redistribution result in resources being devoted toward tax avoidance activities.
D) all of the above are true.