Laffer curve led to federal budget surpluses. The Republican party, which was then based in the protectionist industrial Northeast, argued that cutting rates would lower revenues. But the Democratic party, then rooted in the agricultural South, argued tariff reductions would increase revenues by increasing the number of taxable imports. In 2012, economists surveyed by the University of Chicago rejected the viewpoint that the Laffer Curve's postulation of increased tax revenue through a rate cut applies to federal US income taxes of the time in the medium term. When asked whether a "cut in federal income tax rates in the US right now
Yerkes–Dodson law Yerkes–Dodson law The Yerkes–Dodson law is an empirical relationship between arousal and performance, originally developed by psychologists Robert M. Yerkes and John Dillingham Dodson in 1908. The law dictates that performance increases with physiological or mental arousal, but only up to a point. When levels of arousal become too high, performance decreases. The process is often illustrated graphically as a bell-shaped curve which increases and then decreases with higher levels of arousal. Research has found that different tasks require different levels of arousal for optimal performance. For example, difficult or intellectually demanding tasks may require a lower level of arousal