Q:I can use this background: The Laffer curve depicts the amount of government revenue as a function of the rate of taxation. It shows that for a tax rate above a certain critical rate, government revenue starts decreasing as the tax rate rises, as a consequence of a decline in labour supply. This theory supports that, if the tax rate is above that critical point, a decrease in the tax rate should imply a rise in labour supply that in turn would lead to an increase in government revenue.  Now, I have a new situation: After the second world war Germany and France took two different policies in respect to taxation. After the war Germany, then West Germany, has mostly elected pro-capitalist governments. As a consequence, Germany implemented tax rate below the critical rate. But France took the other way. Their mostly pro-socialist governments implemented tax rate above the critical rate. As a result, businesses had to make informed decisions while doing business in these countries.  Answer this question please: Which country would attract businesses requiring higher labor supply, Germany or France?
A:
Germany